Mitchells & Butlers (M&B), the owner of Toby Cavery and All Bar One, this morning launched a “critical” bid to raise £351m after the pub group’s liquidity “deteriorated significantly” during the pandemic.
M&B said the open offer, which has been underwritten by majority shareholder Odyzean, will enable the company to reduce its unsecured debt and meet its fixed payment obligations.
The cash injection will also be used to invest in its estate to help the company, which also owns Harvester and Nicholson’s, regain momentum after the crisis.
M&B has secured a new £150m three-year unsecured revolving credit facility with its banks, but the money is conditional on the completion of the open offer.
It has also reached agreements with its lenders in relation to breaches of its secured debt financing. Those amendments and waivers could be withdrawn if the open offer is not completed.
M&B is proposing to offer new shares at a price of 210p per share.
Shareholders Piedmont, Elpida and Smoothfield have been acquired by new investment vehicle Odyzean Group, which now owns around 55 per cent of M&B’s issued share capital, marking a change in control of the comapny.
Odyzean has agreed to take up its entitlements under the open offer and to subscribe for any additional shares that become available through, and are allocated to it under, the excess application facility.