North West pub chain is snapped up in £17.9m deal

Bravo Inns

A pub group based in Warrington has been bought in a deal worth £17.9m.

Bravo Inns, which owns more than 40 community-based pubs in the North West has been bought by property investment firm NewRiver.

The Bravo brand will be merged into Hawthorn Leisure – the pub chain owned by NewRiver.

Hawthorn Leisure operates leased, tenanted and managed pubs across England, Scotland and Wales.

Hawthorn Leisure was acquired by NewRiver REIT plc in May 2018. As a result the firm now operates over 650 community pubs within its portfolio on the Hawthorn Leisure pub platform.

NewRiver said the deal represents an EBITDA multiple of 6.8x.

The transaction is expected to generate annualised outlet EBITDA of £2.6m, equating to a yield on cost of 14%.

The figures do not include £300,000 of savings which will be made through the transfer of Bravo Inns to the Hawthorn Leisure platform.

Bravo Inns owns 44 wet-led community pubs, predominantly based in towns across the North West.

The Bravo Inns management have established a high-quality, well-managed and well-invested operator managed portfolio which complements Hawthorn Leisure’s existing 660 community pub portfolio.

The acquisition will increase NewRiver’s exposure to the highly profitable operator managed pub model.

The move will provide the company with opportunities to drive higher returns through accretive capital expenditure and other asset management initiatives.

Mark Davies, chief financial officer of NewRiver and chief executive of Hawthorn Leisure, said: “The UK pub sector has experienced a recent revival in transaction activity and, as an early investor into community pubs, we have been tracking the success of Bravo Inns for some time.

“The transaction will increase our portfolio weighting in community pubs and demonstrates the value of our Hawthorn Leisure platform in identifying acquisitions that can deliver higher yielding sustainable cashflows with scale driven synergies.

“A further attraction of this acquisition is the quality of the pub estate and the pub partners. We look forward to welcoming Bravo Inns and its pub partners to Hawthorn Leisure.”

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