Self-managed investment trust Caledonia is shelling out £118m for The Liberation Group, the largest pub, restaurant and drinks business in the Channel Islands.
Completion is expected over the course of the summer afte previous owners LGV Capital agreed to sell the business.
Liberation was founded in 2008 through a management buy-in led by Mark Crowther and equity backed by LGV. It owns and operates a fully integrated pub and drinks business located in the Channel Islands and the West Country in the UK. The business comprises 94 high quality managed and tenanted pubs, two award-winning breweries and three wholesale businesses. The breweries are located in Jersey and Bristol.
Liberation has grown strongly since its formation. During that time, the pub estate has increased from 65 to 94 outlets, and management has launched the Liberation Ale brand in the Channel Islands, where it is the market-leading brewer, wholesaler and pub operator.
18 months ago Liberation acquired the Butcombe Brewery and pubs business located near Bristol as a platform for expansion in the UK. Butcombe owns 20 pubs in the West Country in village and suburban locations.
Caledonia is backing the existing management team by providing an additional £40m of funding for investment in its existing estate and acquisitions in both its heartland in the Channel Islands and the West Country.
Duncan Johnson, head of unquoted investments at Caledonia, said: “We are attracted to the business by its high quality pub estate and leading market position in the markets in which it operates. We believe that with Caledonia’s longer term support Liberation will be ideally placed to take advantage of growth opportunities, both within its existing estate and through further selective acquisitions. Liberation will complement the other defensive, asset-backed and cash generative leisure businesses in our unquoted portfolio. The investment will pay an attractive yield from inception.”