S&N pubs arm future in doubt after £10b takeover deal

The future of the pub arm of Scottish & Newcastle remains uncertain after the £10b takeover of the brewer by Carlsberg and Heineken finally concluded last week.

Scottish & Newcastle Pub Enterprises (S&NPE), which has more than 2,000 leased pubs across the UK, comprises three pub brands: James H Porter community pubs, Village Inn, targeted at rural and suburban areas, and Urban Inns, for town centres and affluent suburban areas.

It is also the home of Discovery Pub Company, a portfolio of more than 250 pubs it operates for commercial property investor Active Asset Investment Management following AAIM's purchase of 279 pubs from Marston's last May 2007 for £82.5m.

A spokesman for S&NPE said that it would be "very much business as usual" for the operator in the short term but admitted that any questions about how the takeover will affect the pub group's tenants would have to be answered by its new owners after the deal is approved in April.

Heineken's chairman and chief executive Jean-François van Boxmeer, said S&NPE was a solid business model but would not be drawn on future developments.

"The tenanted model that Scottish & Newcastle operates is one of the highly successful and integral parts of their business and is one way to engineer superior growth of market share," he said.

"We like the way the pub company is operated and we see it going forward as a very sustainable business model and we do not see a reason to change that. As for development plans, it's much too early to go into that."

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By Christopher Walton

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