The Red Lion is owned by Punch Taverns. Punch Taverns have been heavily indebted for quite some while. We have been watching with interest & some concern at the ongoing press speculation that there has been over the past year or more about whether Punch Taverns would be able to successfully restructure their debt in a way that meets their bondholders expectations.
Deadlines for restructuring the enormous £2.3bn debt have come & gone. However, it looks as if we have reached a point where something will happen in the immediate future, one way or another. The press over the past couple of days is awash with stories about the impending defaulting by Punch Taverns should the debt restructuring that it announced yesterday not be accepted. It appears that a meeting of those to whom Punch Taverns is in debt to is to be held on 14 February.
The Publicans Morning Advertiser yesterday carried details of Punch Taverns proposals in an article under the heading “Punch announces full restructure proposal” -http://www.morningadvertiser.co.uk/content/view/print/867420
Also yesterday the Daily telegraph, in article headed “Punch Taverns on collision course with lenders over £2.3bn debt” indicated that some of those who are owed money by Punch Taverns would reject the proposals. Last September Punch Taverns warned that if restructure plans were not accepted then it would not be able to continue trading as a going concern.
In today’s Independent an article “It’s time for Punch Taverns to put up or shut up”. Basically the article says that the saga of Punch Taverns attempt to deal with its huge debt has gone on long enough and speculates as to intentions of both the Punch Taverns management & the bond holders as they all now go eyeball to eyeball.
Further, in today’s Guardian article “Punch Taverns warns of default if restructure rejected” gives detailed analysis of the difficulties of trying to restructure the debt. Interesting is the fact that despite the business only having a share value of just over £100m it has spent £20m on restructuring advisers. This comes on top of £30m previously spend on advisers when it not that long ago demerged the company’s managed pub division Spirit Group.
At the end of the day it will be the landlords & the customers of Punch Taverns pubs who are left wondering what will all of this mean for them & my local. We wonder what this will mean for the Campaign as it continues to prepare to seek to purchase the Red Lion from Punch Taverns.