Heineken buys UK pubs for £412m
Royal Bank of Scotland, the taxpayer-owned bank, has sold 918 pubs to Heineken for £412m, including the Punch Bowl in London partly run by film director Guy Ritchie.
The bank has owned the Galaxy Pub Estate since 1999 and they have been run by Scottish & Newcastle, now part of Heineken.
The deal will make Heineken one of the largest pub owner and operators in the UK, adding to its existing portfolio of 462 outlets.
RBS, 83pc owned by Government after its bailout during the credit crisis, said the sale was in line with its strategy to reduce non-core assets.
The Galaxy tenanted pub business is run by traditional publicans who will pay Heineken rent and rely on it for their beer supplies. Tenanted pubs have generally fared less well during the economic downturn than managed pubs, which are run directly by the operating company and generally have greater freedom on pricing.
Securing the pubs provides Heineken with a key channel to sell its drinks, which also include ciders Strongbow and Bulmers.
Stefan Orlowski, managing director of Heineken UK, said: "There continues to be an important role for the great British pub in the UK on-trade, and this acquisition is a significant vote of confidence in the channel.
"Owning the Galaxy freehold will allow us to continue the successful transformation of our pub business, concentrate on operational excellence and deliver long-term value from a high-quality, well invested pub estate."
When RBS acquired the pub freeholds from brewer Scottish & Newcastle over a decade ago it turned the bank into one of the biggest leased pub landlords in the country.
At the time, the deal was considered innovative for Scottish & Newcastle because the brewer continued to provide property management and beer to the pub estate once it completed the transaction.