Brewery takeover will shed 500 jobs

CLIFFORD GERMAN

About 500 jobs will go under yesterday's agreed pounds 480m bid by Greenalls for the Boddington Group pub chain. The deal, still to be approved by shareholders, would create a new group worth almost pounds 1.5m.

The merged group intends to close four offices in the Warrington area and half the 44 Boddington wholesale depots in north-west England to create savings of pounds 18m a year.

Greenalls is offering 17 new shares and pounds 20 in cash for every 25 shares in Boddington. As an alternative Boddington shareholders can opt for up to pounds 73.39p in cash and 5.13 shares for every 25 Boddingtons.

Boddington shares gained another 31p to 389p yesterday, after leaping 86p late on Thursday when Boddington confirmed the talks. After a late fall of 9.5p on Thursday, Greenalls shares fell a further 26.5p to 462p yesterday, which values the bid at pounds 480m and Boddington shares at 394p, 45 per cent more than they were trading earlier in the week. The enhanced cash option values them at 388.5p.

The bid will cost Greenalls pounds 16m, and reorganisation costs a further pounds 23m, half of which will pay for the redundancies. Buying out Boddington directors' options will cost a further pounds 8m. If shareholders accept the standard offer Greenalls will need to raise pounds 100m in cash and it will also assume pounds 124m of Boddington debt, which will raise group gearing from a little under 50 per cent to around 75 per cent, excluding any assets that might be disposed of.

Greenalls' chairman and chief executive, Andrew Thomas, forecasts profits of not less than pounds 100m in the year just ended, an improvement of 33 per cent, and a final dividend of 8.44p, which Boddington shareholders will also get. Analysts have been forecasting profits of pounds 43m for 1995-96 for Boddington.

Both groups disposed of their breweries as the industry restructured following the Monopolies Commission report in 1988 and have made good profits at the expense of the brewers thanks to an oversupply of brewing capacity. But the merger is necessary to maintain the pubs' purchasing power as the brewers rationalise capacity, according to Mr Thomas.

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksA special investigation by Andy McSmith
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Financial Adviser

£20000 - £60000 per annum: Recruitment Genius: Are you recently QCA Level 4 qu...

SThree: Graduate Recruitment Resourcer

£20000 - £22500 per annum + OTE £30K: SThree: SThree Group have been well esta...

Guru Careers: Application Support Analyst / 1st Line Support

£25 - 30k: Guru Careers: We are seeking an Application Support Analyst / 1st L...

Guru Careers: .NET Developer / Web Developer

£45K - £55K (DOE) + Benefits: Guru Careers: We are seeking a full stack .NET D...

Day In a Page

Not even the 'putrid throat' could stop the Ross Poldark swoon-fest'

Not even the 'putrid throat' could stop the Ross Poldark swoon-fest'

How a costume drama became a Sunday night staple
Miliband promises no stamp duty for first-time buyers as he pushes Tories on housing

Miliband promises no stamp duty for first-time buyers

Labour leader pushes Tories on housing
Aviation history is littered with grand failures - from the the Bristol Brabazon to Concorde - but what went wrong with the SuperJumbo?

Aviation history is littered with grand failures

But what went wrong with the SuperJumbo?
Fear of Putin, Islamists and immigration is giving rise to a new generation of Soviet-style 'iron curtains' right across Europe

Fortress Europe?

Fear of Putin, Islamists and immigration is giving rise to a new generation of 'iron curtains'
Never mind what you're wearing, it's what you're reclining on

Never mind what you're wearing

It's what you're reclining on that matters
General Election 2015: Chuka Umunna on the benefits of immigration, humility – and his leader Ed Miliband

Chuka Umunna: A virus of racism runs through Ukip

The shadow business secretary on the benefits of immigration, humility – and his leader Ed Miliband
Yemen crisis: This exotic war will soon become Europe's problem

Yemen's exotic war will soon affect Europe

Terrorism and boatloads of desperate migrants will be the outcome of the Saudi air campaign, says Patrick Cockburn
Marginal Streets project aims to document voters in the run-up to the General Election

Marginal Streets project documents voters

Independent photographers Joseph Fox and Orlando Gili are uploading two portraits of constituents to their website for each day of the campaign
Game of Thrones: Visit the real-life kingdom of Westeros to see where violent history ends and telly tourism begins

The real-life kingdom of Westeros

Is there something a little uncomfortable about Game of Thrones shooting in Northern Ireland?
How to survive a social-media mauling, by the tough women of Twitter

How to survive a Twitter mauling

Mary Beard, Caroline Criado-Perez, Louise Mensch, Bunny La Roche and Courtney Barrasford reveal how to trounce the trolls
Gallipoli centenary: At dawn, the young remember the young who perished in one of the First World War's bloodiest battles

At dawn, the young remember the young

A century ago, soldiers of the Empire – many no more than boys – spilt on to Gallipoli’s beaches. On this 100th Anzac Day, there are personal, poetic tributes to their sacrifice
Dissent is slowly building against the billions spent on presidential campaigns – even among politicians themselves

Follow the money as never before

Dissent is slowly building against the billions spent on presidential campaigns – even among politicians themselves, reports Rupert Cornwell
Samuel West interview: The actor and director on austerity, unionisation, and not mentioning his famous parents

Samuel West interview

The actor and director on austerity, unionisation, and not mentioning his famous parents
General Election 2015: Imagine if the leading political parties were fashion labels

Imagine if the leading political parties were fashion labels

Fashion editor, Alexander Fury, on what the leaders' appearances tell us about them
Phumzile Mlambo-Ngcuka: Home can be the unsafest place for women

Phumzile Mlambo-Ngcuka: Home can be the unsafest place for women

The architect of the HeForShe movement and head of UN Women on the world's failure to combat domestic violence