London Town, the AIM-listed pub company backed by property entrepreneurs Jack Petchey and the Richardson brothers, has expanded its pub portfolio.
London Town has bought GRS Inns for £4.3m and appointed a new chairman and chief executive.
60 new pubs to join group
GRS Inns is a managed pub operator and service provider to the leasehold pub industry with 60 unbranded leasehold pubs in the UK.
For the year to 27 May 2007, GRS generated unaudited pre-tax profits of around £396,000 and has a stated a net asset value of £725,000 against gross assets of £3.9m.
The purchase will take London Town’s total pub portfolio to 222 tenanted pubs.
Shake up of board
The shake up of the board at London Town following the acquisition sees John Sands, currently chairman of GRS, to become non-executive chairman of the enlarged London Town group and Andrew Wilson, current chairman of London Town, will remain a non-executive director.
London Town has also appointed Richard Gundry, currently managing director of GRS, as chief executive. Ian Robinson will remain finance director and company secretary.
As the result of the purchase of GRS, GRS shareholders, including Sands, Gundry and Howard Thornton now own around 13.5% of the enlarged group’s equity.
London Town has financed the purchase with the issue of 4,117,647 new Ordinary shares in London Town at 85p per alongside the payment of £485,000 in cash.
London Town is also funding the repayment of GRS Directors' loans totaling £325,000.
John Sands, chairman, said: ‘The combination creates a dynamic estate of managed and tenanted pubs and injects a new managed house skill base to the London Town business.’