17th Oct 2007 07:01
Restaurant Group PLC17 October 2007 The Restaurant Group plc Acquisition of Brunning & Price Limited The Board of The Restaurant Group plc ("TRG" or "the Group") announces that ithas acquired the entire issued share capital of Brunning & Price Limited ("B&P")for £32 million. B&P operates 14 high quality pub restaurants, predominantly inthe North-West of England. Five are freehold sites and nine are leaseholds. Afurther freehold site which is currently undergoing redevelopment is expected toopen during 2008. B&P's pub restaurants are character properties locatedpredominantly in rural and semi-rural locations. The acquisition of B&P provides TRG with increased opportunities to furtherdevelop its pub restaurant business, a segment of the eating out market whichpossesses good prospects for long-term sustainable growth, distinct barriers toentry and the prospect of good returns on investment. The acquisition iscomplementary to Blubeckers, the pub restaurant business acquired by TRG in2005. Following the acquisition the Group will have a portfolio of more than 40pub restaurants and it is the Board's intention to roll out both B&P andBlubeckers pub restaurants in both rural and semi-rural locations. B&P was established in 1981 and has been steadily developed since inception. B&P's pub restaurants offer good quality food and beverage in a relaxed andwelcoming environment. The style of operation, customer base and price pointfit well with TRG's market positioning. B&P is a high quality operator and thishas been recognised by both its customers and independent referencing bodieshaving won the Pub Group of the Year award three times in the past ten years,most recently in 2007. The business has shown a consistent performance and hasa solid record of profitable growth. The existing management team of B&P willremain with the business. In the year ended 30 June 2007 B&P generatedrestaurant EBITDA of £3.9m1, an increase of 12% on the previous year. TheDirectors of TRG expect the acquisition of B&P to be earnings enhancing2 in thecurrent and future financial years. The consideration comprises £26.4 million for the share capital and £5.6 millionfor the repayment of existing debt within B&P. This has been satisfied from theexisting banking facilities available to TRG which have been extended from £80million to £100 million and rolled over until April 2009 on similar commercialterms. Andrew Page, Chief Executive of The Restaurant Group plc, said: "We are delighted to have secured ownership of the Brunning & Price business andto welcome its team into TRG. Its expanding portfolio of 14 pub restaurants isof an exceptionally high standard both in terms of profitability and quality offood, beverage and service. In 2007 B&P was voted Pub Group of the Year by theGood Pub Guide - testament to its consistently high standards of quality, valueand service. Our pub restaurant businesses now comprise in excess of 40 sites locatedpredominantly in Cheshire, the North West and the South East. The acquisitionof B&P enhances our opportunities for future rollout and the further profitabledevelopment of our pub restaurant business." NOTES: 1. In the year ended 30 June 2007 the acquired business had turnover of £17.95m,profit before interest and tax of £1.5m, profit before tax of £1.2m and grossassets of £19.2m. Before central overheads of £1.6m, the restaurant EBITDA ofthe business acquired was £3.9m. 2. This statement should not be taken to mean that future earnings per share ofThe Restaurant Group plc following the acquisition will necessarily match orexceed historic earnings per share and no forecast is intended or implied. 3. Certain statements made in this announcement are forward-looking statements.Such statements are based on current expectations, and by their nature, aresubject to a number of risks and uncertainties that could cause actual resultsand performance to differ materially from any expected future results orperformance expressed or implied by the forward-looking statement. Theinformation does not assume any responsibility or obligation to update publiclyor revise any of the forward-looking statements contained herein. 17 October 2007 ENQUIRIES: The Restaurant Group plc Tel: 0845 612 5001Andrew Page, Chief Executive OfficerStephen Critoph, Finance Director College Hill Tel: 020 7457 2020Matthew Smallwood This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
RTN.L