Leisure group Rank today revealed the latest stage of its long-running debt-reduction disposal programme with the £90m sale of its Tom Cobleigh pubs chain.
Over the last year Rank has sold off a vast array of assets including its Odeon cinema chain, Pinewood Studios and 50% stake in Universal Studios, the Florida theme park.
However, even after today’s sale to private equity group Electra, the group is understood to be around £500m in the red.
The latest deal will leave Rank with a much streamlined business centred on its gaming operation, which includes Mecca bingo, its chain of Hard Rock Café restaurants and its Deluxe film duplication operation. In addition, the group owns a range of UK holiday brands including Warner, Oasis and Haven.
However, it is understood the company is in talks with privately-owned caravan operator Bourne Leisure with a view to a £500m sale of the holiday businesses. And it has been reported that Mike Smith, the Rank chief executive who took over the reins in April, could even be looking at a sale of the Deluxe operation.
Today’s sale to Electra, represents a big cut compared with the £113m price which it paid for Tom Cobleigh in 1996. At the time the group came in for criticism for having paid over the odds for the pubs chain.
Northampton-based Tom Cobleigh operates 87 managed pubs and 23 tenancies within the UK and employs 2,500 staff.
For the year to December 31 1999 the pub chain’s turnover was £59m and its operating profit before exceptional items was £8m.
The chain will be run by a new management team led by chairman Bill McCosh, former chief executive of Mansfield Brewery and chairman of Mill House Inns, although current finance director Charles Freeman will remain in his role.
EGi News 04/09/00
