Marston’s today announced plans to raise £176m through a share issue to create a warchest to speed up development of new pub sites and make acquisitions.
The brewer and pub operator will use £140m of the total to acquire and develop new pubs, taking advantage of the weakening property market.
The remaining money will be used to pay down debt and act as a reserve to be used to buy any attractive pub packages that come to market.
Ralph Findlay, chief executive of Marston’s, said: “The current market environment represents a rare opportunity to secure excellent sites on attractive terms.
“The rollout of new-build pubs can generate higher returns at lower risk than acquiring mixed packages of existing pubs and is important to our long term strategy to drive shareholder value.”
As long as the share issue is approved at an extraordinary general meeting on 6 July, Marston’s expects the cash injection to allow it to increase new openings to 15 pubs in the first full year to 2 October 2010 and 20 to 25 sites a year thereafter.
Rival groups Punch Taverns and Greene King have both recently issued share issues to raise cash in the tough financial market.
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By Chris Druce
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