Fuller’s acquires Cotswold pubs package for £40m

23-Oct-2019 - Last updated on 23-Oct-2019 at 09:44 GMT

Big acquisition: Fuller’s will take over Cotswolds Inns & Hotels at the end of this month

Pub chain Fuller’s has acquired a collection of pub and hotel sites in the Cotswolds in a £40m deal.

The acquisition of Cotswold Inns & Hotels, includes seven freehold country inns and hotels alongside eight staff cottages.

The chain has also agreed to purchase two leasehold bars in the centre of Birmingham.

It said the acquisition will be funded from existing banking facilities and was expected to complete on 31 October 2019.

Sought-after sites

Fuller’s chief executive Simon Emeny said the portfolio of inns would complement its existing estate of pubs with rooms.

He said: “The inns and hotels being acquired are all iconic, character properties in sought-after locations in the Cotswolds.

“They will further enhance our existing portfolio of premium hotel accommodation, adding 201 stylish bedrooms.

“A number of the sites have further development potential and Cotswold Inns & Hotels benefits from an established function business, spanning both leisure and corporate custom as well as weddings.

“We expect to realise further benefits from bringing the properties into Fuller’s and for the acquisition to be earnings-accretive in the first year.

“Quintessentially English and renowned for a focus on fresh food, premium accommodation and an exceptional level of customer service, this collection of seven iconic country hotels is highly complementary with our existing strategy.”

Revenue generated

Cotswold Inns & Hotels was founded in 1997 by operators Michael and Pamela Horton and its estate includes an eighth hotel – The Broadway Hotel, Worcestershire – which will be retained by the current owners.

The properties set to be acquired by Fuller’s made revenue of £17.5m in the financial year ending 30 September.

The pub operator sold its brewing business to Asahi for £250m earlier this year with its chief executive describing the year as a “transitional” one for the company.

Its managed pubs and hotels business saw sales up 4.9% and revenues up 8% to £298.8m for the 52 weeks to 30 March 2019 and its operating profits rose by 5% to £35.1m.

In the financial year ending 30 September 2018, the properties being acquired generated revenue of £17.5m and site EBITDA (earnings before interest, taxation, depreciation and amortisation) of £3.4m with a gross asset value of £31.5m.