Enterprise Inns has agreed to buy the 277-strong Discovery Inns (DI) pub chain in a £46.2m package which values DI at £19.5m.
In addition, Enterprise has agreed to repay DI’s long-term debt of £26.7m. The deal is subject to shareholders approval next month.
The deal will be financed by a three for eight rights issue which Enterprise hopes will raise £33.2m. Enterprise will also take out a £23m bank loan.
If the takeover is ratified by an EGM on 9 May, Enterprise Inns wil control over 1,100 pubs.
The takeover emerged as Enterprise posted a 74% increase in pre-tax profits to £6.2m pre-tax profits, on sales up 90% at £23.6m for the six months to 29 March. The company’s shares rose 0.5pence once news of its proposed takeover emerged this morning.
EGi News 24/04/97
