Punch Taverns, which owns the Red Lion and 4,000 other pubs (1 in 10 of all pubs around the country) has been struggling for some while now under crippling debt. According to the Mail on Sunday and the Publican's Morning Advertiser (pub trade paper) there is now the possibility of the pub group defaulting on its debt repayments and going into administration, thus potentially leading to the break up of the company.
Punch Tavens carries £2.4bn of debt and according to the press reporting negotiations between Punch Taverns and its debt holders are approaching stalemate. Punch Taverns is understood to want to reach an agreement with them by the end of June or the company could default on its payments. This could lead to a process in which a receiver would be appointed who could chose to sell or close pubs to pay back the debt. Punch Taverns recorded a £16.7m pre-tax loss for the six months up to the end of March. As a sign of its problems Punch Taverns Chief Executive left in February.
Alternatively, the company could be forced to agree a pre-pack,which is a form of agreed insolvency, in which the company would be declared bust and its assets (including its pubs) transferred to new owners in a single step.
All in all, the signs for Punch Taverns, which have not been good for some time now, look pretty dire. This can only add to the pressure on Punch Taverns to sell or close those pubs, like the Red Lion, that they have already put up for sale. This demonstrates that there is no time to lose to start to campign to ensure that under some form of ownership, that looks increasingly clear not to be Punch Taverns, the Red Lion is retained as the pub in the village.
The links to the articles in the Daily Mail and the Publican's Morning Advertiser can be found -
Save The Red Lion Campaign Patrons
- Sidbury Community Enterprises' community share offer launched to buy the Red Lion
- Save The Red Lion Campaign Patrons - Rt Hon Hugo Swire MP & The Reverend Susie Williams
- Campaign's company - Sidbury Community Enterprises - has made an offer to buy the Red Lion
- East Devon District Council has listed the Red Lion pub as an Asset of Community Value - a significant Campaign milestone