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Marston's/Brains
R
Ralph Findlay
to me
39 minutes agoDetails
Dear Mr Bradshaw,
If you look on the Marston's PLC website under 'Corporate', and 'Presentations', you should find a video link to the presentation given to analysts on Friday morning. As I explain at the beginning of the presentation, we were not able to give the presentation previously because of the potential offer situation that existed at the time of completion in February, which is when we had intended to give it. The link is also here:
https://vimeopro.com/instinctifpartners/marstons-brains-transaction-update-5-march-2021
The presentation gives details of the transaction in some detail, and sets out the details behind our plans for the core estate of 107 pubs. You can also see/hear the analyst questions, and our answers.
On the subject of the Platinum offer, I am pleased to hear your view on valuation: I, and the rest of the Board, agree with you.
As to whether the previous offers should have been disclosed by way of an RNS, that will always be a matter of judgement: there is no requirement to do so under Takeover Panel Rules unless there is a sharp change in price. If that happens - and it did - it indicates that there is some market awareness . Usually, it comes about through a leak. Such an increase in price did take place on the day we received the third proposal, and our RNS was issued within an hour or so of that happening.
In any situation like that, there are clear but complicated Takeover Panel Rules, and they must be followed. You can be certain that the Panel would have been aware of this process from the very first point that a proposal was made. There are several good reasons why approaches may not be made public, including reservations about value, about deliverability, or some uncertainty in a due diligence requirement. That changes if the approach is leaked, as I have described above.
You should also be reassured that in any situation like this, a Board must take independent advice, and must satisfy itself that it is acting in the best interests of shareholders. As I have noted, that consideration is not solely about value - though that is obviously a major factor - but extends to concerns about whether a proposal made 'subject to' can and will be delivered as proposed. In our view, the Platinum proposal did not meet the first 'valuation hurdle', and was, as you know, rejected.
Finally, I am also pleased to hear that you have enjoyed the service in Marston's pubs. If it is Stourbridge you are referring to, than that is probably The Glasshouse - we have a very good team there, which is what always makes the difference.
Yours sincerely,
Ralph Findlay
Chief Executive Officer
Dear Mr Bradshaw,
If you look on the Marston's PLC website under 'Corporate', and 'Presentations', you should find a video link to the presentation given to analysts on Friday morning. As I explain at the beginning of the presentation, we were not able to give the presentation previously because of the potential offer situation that existed at the time of completion in February, which is when we had intended to give it. The link is also here:
https://vimeopro.com/instinctifpartners/marstons-brains-transaction-update-5-march-2021
The presentation gives details of the transaction in some detail, and sets out the details behind our plans for the core estate of 107 pubs. You can also see/hear the analyst questions, and our answers.
the MM know that this has great potential. everything about this company is saying its been set up for a very strong potential in 2021 and beyond.
Will never understand the mm's... so many bought, half as many sold... where is the SP increase!
I've just sent this off to RF.
Good afternoon Mr Findlay.
I am a shareholder of Marston's with a modest holding, but I have a couple of questions to ask relating to a couple of points that have caught my attention of late.
My first point relates to the tie in with Brains. I can see some benefit of linking in with them, but the detail of the rationale behind your reasoning may be, along with what the coatings are, and what we are likely to get out of it for ourselves.
Another point I've come across, was that When can Shareholders expect to see the Management Agreement promised for the 5th February?
Intial agreement stated we were to manage 156 pubs within Brain's estate, yet I understand that the analyst's presentation states 107 plus 30 under par Pubs, where are the remaining 19 pubs?
Also, with the Platinum approach that was made, I understand that there were at least 3 different offers were made. I get that 2 of them were low value offers, which I can understand as being dismissed out of hand, however, it seems strange that no mention of these approaches were made to shareholders via an RNS. My own view of the 3rd offer of £1.05 being rejected, to me is entirely justified. As when "Normality"resumes in life after lockdown, the value of the business will very easily reach beyond this figure.
Speaking for myself, I am invested here because of the service I have received in a couple of the Marston's pubs I have been in. I have mentioned one of the pubs myself and family have visited in Stourbridge while visiting friends that live in the area to you a while back.
I appreciate that you have a lot on your plate at the moment, but I would appreciate your thoughts on these questions when you have a moment please.
Thank you.
more good news for Pubs:
https://news.sky.com/story/covid-19-al-fresco-boost-for-pubs-and-restaurants-with-councils-told-to-slash-planning-red-tape-12238455
"Red tape must be cut to make it easier for pubs and restaurants to have tables and chairs in the street or put up marquees in their beer gardens, the communities secretary has said."
@Clairesmith.
That sounds like a win to me.
the fact that they are now saying for foreign holidays you will need proof of vaccine and the majority of the youth (18 to 45 year old) population have yet to be vaccinated means alot of people will want to party but stuck in UK.
As such, imagine the sheer amount of money that will be spent in pubs over June to Sept time, massive amounts.
BBC: 'Pubs deluged with beer garden bookings'
https://www.bbc.co.uk/news/business-56296518
if you were to tell me that June to September 2021 was the record months for alcohol consumption in pubs in the UK ever I would believe you.
the sheer amount of people doing dry months on the lead up to ready to have fun when pubs open again is massive.
combined with people wanting to get out of their homes can see marstons making a ton of cash over this period.
taking all factors into account can see more legs under this share and more rise to come:
UK out of EU
the next year staycations being all time high
the overall desire for Brits to get into a pub and beer garden
Strong resistance at £1, agree that we need some more clarity from management.
Think that this SP will get more attention once it properly surpasses the 1/1.05 mark
Fairdealer/Trent
I must confess to feeling much the same as FD, I have become disillusioned with this "mushroom" attitude that the BoD seem to be using currently.
Certainly more interaction from the board would be warmly welcomed.
I'm not gonna be able to do it until Monday at the earliest now but I will get on to it.
Hi Trent, yes, keep it brief.
When can Shareholders expect to Management Agreement promised for the 5th February?
Intial agreement stated we were to manage 156 pubs within Brain's estate, yet today the analyst's presentation states 107 plus 30 under par Pubs, where are the remaining 19 pubs?
precis it to suit Trent if you wish.
Fairdealer. Tell me what you want putting in. And if anyone else can think of anything stick it on here. But if you could keep it brief, it would be helpful.
Thanks Trent, would be grateful if you would write. I seem to make too many bullets!!!
Cheers
Fairdealer.
Some valid points. Some of your points do need answers. One way to find out would be to email RF and ask for direct answers.
Shall I take the lead?
Call me a pessimist, I prefer realist. I do not agree with expectations voiced, for the following.
There will be a stampede once pubs etc open up. Let's assume it will be May, the sector have lost 2 of the most valuable income periods with Christmas/New Year and Easter. This leaves the hoped for lucrative summer which given good weather could be a bonanza, don't forget some huge sporting events, Olympics, Euro Cup etc etc. Some of these events, Olympics are likely to be stay at home for most and will aid off-sales but not Pub sales. Looking at the accounting year, ends 30 September, a hell of a lot of lost income has got to made in 5 months. There won't be any profit for the current year.
Looking at the role of the CEO, the clear intention to not engage with Platinum by the hasty completion of the arrangement with Brains demonstrates a closed mind. Remembering Platinum were not enamered by the Brain's event, they had until the end of February to make a final offer...we will never know how much more would have been on the table above 105p.
It is symptomatic of the mind-set, that whilst negotiations were taking place with Brains in early December, 2 offers were put forward by Platinum which PI's were not informed until end January. Now ( today) we are told about an Analsyts presentation today focused on the future with the Welsh estate., and shareholders are still waiting the Management Agreement promised on the Brain's Completion day ( 5th February).
Shareholders are in the dark on the substance of this agreement.
The original understanding stated there are 156 pubs in the Brains estate which Marstons would manage.
The Presentation to Analysts states 107 pubs plus 30 below par where a peppercorn rent will be due for 18 months.
Rent on the Brain Estate is due in Advance.
Where are the missing 19 pubs?
Are Marston's enhancing the 30 below par pubs in return for Nil rent?
The problem, as I see it, until the Management Agreement is published, what exactly is Marstons letting it self in for? The plain fact is Ordinary Shareholders do not know.
It may seem pessimistic, but questions need answers, any LTH should be concerned at the disdainful way in which information is obscure or being witheld.
AIMO
DYOR
I agree with Trent on this, I think some here are taking an overly pessimistic view; it's highly likely waivers will be signed and Mars has more than enough liquidity to see them through until reopening anyway. Furlough scheme also allows for a financially flexible reopening at a perfect time (June-Sep) when consumer spending will surely be at an all time high (indeed, the young will be spending like millionaires, combined with all the staycationing).
In terms of analytics, the SP is showing positive signs that is gradually re-rating back to pre-covid levels.
Still holding here with a target of 1.30-1.50 medium term.
Good morning London 69.
Yes, Indeed. I get your point on waiting to see what transpires sp wise on it's own merit. I rather think that you perhaps look at things a little more clinically than I do with this one. I'll be joining you in raising a glass of two when the pubs open and we are proved to be right.
Have a good day mate.
Good morning Trent,
I agree it's more than probable that we will get to 105p and only at that point will I say well done to RF for making the right call for shareholders.
Thanks
@London69.
Looking at current sp, I would say that expecting to see £1.05 on the open market in the short to med term is a reasonable assumption to make. The probability of reaching beyond that med to long term as lockdown restrictions ease and pubs re-open is also a reasonable assumption to make.
Based on that logic I believe it to be a fair assessment of why I'd said that RF was correct in rejecting. Platinum's approach.
Hi Fairdealer,
We seem to be getting a little bit ahead of ourselves with some suggesting RF rejecting an offer of 105p was the right decision, however its too early to say that and tell me that when the share price increases above that level.
I do think the waivers are somewhat of a formality and given that they are big banks, I expect then to sign, however there maybe an increase in the interest rate.
I would expect secondary secured lenders to get anywhere around 8%.
Good evening all.
barchid, I totally agree. You only need to read the text of the last waiver and it seemed to me they (BNP) are a much tougher bunch of Bankers. Hope RF is not relying on the Covid sympathy card!!