London Town pub group calls in administrators

Published 20th Feb 2010

Management at pub group London Town have struck a pre-pack deal with administrators from PricewaterhouseCoopers that will see them jettison 44 properties from the 350-strong business in a move creating uncertainty for many tenant families living above the unwanted pubs.

In a statement PWC said Christie & Co had been appointed to seek buyers for the 44 pubs. "We will seek to negotiate with landlords to keep as many ... trading as possible," said joint administrator David Chubb.

Many leases on the sites remaining in administration are expected to revert to original holders Punch Taverns and Enterprise Inns – adding to their considerable stable of problem sites. Last month it emerged that 12 former Regent Inns leased sites had reverted to Punch after the company behind Walkabout entered into a pre-pack deal. A year earlier the failure of Orchid pub group forced Punch to take back 45 unwanted leases.

The business emerging from the London Town pre-pack will be led by veteran leisure sector executive Billy Buchanan, who has been combined chief executive and finance director of London Town for 18 moths.

London Town, which comprised many pubs offloaded by Punch Taverns and Enterprise Inns ahead of the smoking ban in 2006, has been in trouble for some time, breaching borrowing covenants in 2008 and 2009. It delisted from the AIM junior stock market this week.

The business had started as a property development operation before moving into the pub trade four years ago with the purchase of 167 pubs from veteran property investor Jack Petchey.

Chubb said: "This has been a particularly complex restructuring but we are pleased to have preserved the majority of the business, and therefore jobs, through the transactions we have completed."

Source: ' Guardian '

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