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Hong Kong investor buys Greene King

Published:  20 August, 2019

Suffolk-based brewery group Greene King has been sold to a Hong Kong conglomerate in a deal worth £4.6bn.

The transaction values the pub and brewery business at £2.7bn and includes £1.9bn of debt liability.

Greene King was founded in Bury St Edmonds in 1799 and currently has some 2,700 pubs, hotels and restaurants across England, Scotland and Wales.

Its brands include Chef & Brewer, Loch Fyne Seafood and Grill and Farmhouse Inns. Aside from Greene King IPA, its beers include Abbot Ale and Old Speckled Hen.

CKA had an existing stake of 2.9% in Greene King. It also owns a portfolio of 162 pubs in the UK, which it has been leasing to the brewer.

George Magnus, chairman of CKA’s investment vehicle CK Bidco, said: "CKA's strategy is to look for businesses with stable and resilient characteristics and strong cash-flow generating capabilities. The UK pub and brewing sector shares these characteristics and we believe that this sector will continue to be an important part of British culture and the eating and drinking out market in the long run.

“Greene King, being a leading integrated pub retailer and brewer with strong real estate backing, is well positioned to capture the opportunities that lie ahead."

Recommending the bid to investors, Nick Mackenzie, chief executive of Greene King, said: "Greene King has a well-invested estate in prime locations, leading brands, a rich history and a talented team of c.38,000 people serving millions of customers across the country every week.

“CKA is an experienced UK investor and shares many of Greene King's business philosophies. They understand the strengths of our business and we welcome their commitment to working with the existing management team, evolving the strategy and investing in the business to ensure its continued long term growth."

CKA has significant stakes in blue-chip UK companies such as UK Rail, Northumbrian Water and Wales and West Gas Network. It owns a range of premium properties in London including Belgravia Place, Royal Gate Kensington and the Chelsea Waterfront development.

Earlier this year, Japanese brewer Asahi bought London’s Fuller’s brewery for £250m.