Competition watchdog rules on £400m Punch Taverns takeover

Punch Taverns

The competition watchdog has cleared the way for the £400m acquisition of part of Staffordshire pubco Punch Taverns to complete.

In June, the Competition and Markets Authority (CMA) said that Heineken’s proposed purchase of part of the Punch Taverns estate could reduce competition in 33 local areas across the country.

Before the merger was referred for a further in-depth investigation, the companies were given the opportunity to offer proposals to address these concerns.

Heineken has now compromised by saying it is willing to sell pubs in each of the affected areas to preserve competition and ensure customers in these locations do not lose out.

In a statement today, the CMA said the Heineken proposals were acceptable and further steps – what is called a phase 2 investigation – were not required.

“Before reaching a final decision, the CMA carefully assessed and consulted publicly on these proposed undertakings. The CMA is satisfied that its concerns have been addressed and has therefore decided that the merger will not be referred for an in-depth phase 2 investigation,” it said.

Punch shareholders approved the sale of the group to Vine Acquisitions in February on the basis of an offer of 180 pence per share, a price which values the business at £402.7m.

Heineken and Patron Capital, using Vine Acquisitions as an SPV, have agreed the deal, which will see them acquire the entire and to be issued share capital of the Staffordshire company.

Immediately on completion of the deal, Heineken was set to acquire from Patron a portfolio of around 1,900 Punch pubs with Patron retaining an additional 1,329 which it would run itself.

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