22nd Jun 2015 14:39
LONDON (Alliance News) - The UK Competition and Markets Authority Monday said Greene King PLC has offered to sell 16 pubs in order to address the regulator's concerns about its proposed GBP773.4 million takeover of Spirit Pub Co PLC.
Earlier in June, Greene King and Spirit Pub said the takeover offer was no longer conditional on approval by the UK Competition and Markets Authority, after Greene King waived the CMA approval condition to which the offer was subject.
On Monday, the CMA said the 16 pubs would be divested by Greene King as properties, together with the relevant pub name and, for managed pubs, the transfer of Greene King and/or Spirit Pub Co's staff.
Of the 16 pubs identified to be sold, nine are Greene King pubs and seven are Spirit pubs, while ten are managed pubs and six are tenanted or leased pubs.
"Before accepting the undertakings, the CMA carefully assessed and consulted publicly on the proposed undertakings. The CMA received one comment on the consultation which it carefully considered, and is satisfied that the undertakings will resolve the competition concerns identified," said the regulator.
The CMA's original investigation into the offer found that around 1,000 Spirit pubs overlap with a Greene King pubs in a local area, and that while in the vast majority of those areas it did not have any competition concerns, there was a "realistic prospect of a substantial lessening of competition in 16 local areas".
The CMA would have referred the case for an in-depth phase 2 investigation if Greene King and Spirit did not offer acceptable undertakings to address the concerns.
Spirit shares are expected to be delisted on June 24, following which a 6.5 pence special interim dividend will be paid.
Greene King shares were up 0.9% to 828.73 pence per share Monday afternoon whilst Spirit shares were up 1.3% to 115.70p.
By Joshua Warner; [email protected]; @JoshAlliance
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