LONDON (Alliance News) - Pub chain Ei Group PLC said Friday that it has entered into agreements with a unit of investment manager Davidson Kempner Capital Management LP for sale of 370 properties for gross GBP348 million in cash.
"We are very pleased to have agreed the sale of the portfolio, which is in line with our strategy of delivering attractive and sustainable returns to shareholders by unlocking the embedded value and optimising the returns from every asset within the business. The portfolio is comprised of high quality assets which we believe are best suited to a free-of-tie, rent-only business model," said Ei Group Chief Executive Simon Townsend.
The company said the property portfolio being sold comprises public houses and other commercial properties. It has entered into sale agreements with Tavern Propco Ltd, a newly incorporated private company owned by investment funds managed by Davidson Kempner.
The sale comprises a significant proportion of the current Ei Commercial Properties division, which owned 412 properties in 2018. Ei Group intends to use a significant proportion of the disposal proceeds to cut debt level and to consider returns to shareholders.
Ei Group said the sale will help the company to invest in core Publican Partnerships, Managed Operations and Managed Investments divisions, whilst at the same time identify properties to rebuild the Commercial Properties division.
Shares in Ei were 4.0% higher at 205.50 pence in early trading Friday.
