Greene King looks set to complete a deal to buy Spirit Pubs Company after C&C Group’s interest in the business waned.
The £773 million acquisition, which is expected to be completed by the middle of 2015, will add over 750 properties to the Greene King estate.
C&C Group, which is best known for its Magners Irish Cider, attempted to gatecrash the deal earlier in 2014 in order to bolster their its cider-centered portfolio. Analysts have questioned C&C’s interest in the deal and said the interest in Spirit was a ‘departure from strategy’.
It is understood that C&C initially approached Spirit in October with an offer of around 110p per share, just three days after Greene King made a 109.5p offer. The rival bid prompted Greene King to reinforce its offer to 115p a share, an attempt to shut down future advances.
The Irish drinks group said in a stock exchange statement on Tuesday that a “combination with Spirit no longer meets the Group’s risk adjusted return criteria”.
Confirming an agenda to acquire Spirit Pubs rewarded C&C with a steady 10% fall in share price, igniting friction from its own investors and dulling the affordability of the deal for the brewer.
However, the willingness of C&C to take such a brash step with Spirit suggests Stephen Glancey, C&C’s chief executive, will still pursue an overhaul of the company’s UK operations and explore opportunities to ramp up Magners’ route to the UK market.
Spirit states the timetable for the recommended offer by Greene King plc is as announced on 18 December 2014 with the relevant meetings of Spirit Shareholders on 13 January 2015 and completion expected by the end of the first half of 2015”.
Reporter: Michael O’Shea