Shares in Britain’s biggest pub companies fell sharply after a Commons vote scrapped the so-called "beer tie", allowing landlord to buy their supplies on the open market.
Enterprise Inns and Punch Taverns, which between them own a fifth of Britain’s 50,000 pubs, saw their shares prices hit again after last night’s defeat for the Government.
Enterprise shares dropped by 13 per cent and Punch’s by 9.4 per cent. Spirit, which is being taken over by rival Greene King to form a 3000-plus pubs estate, was down 6 per cent with the bidder off 4 per cent. Marston’s fell 3 per cent and Mitchells & Butlers lost 2 per cent.
The new legislation would force pubcos with more than 500 outlets effectively to end the beer tie which means they can make their landlords stock the drinks they want.
Simon Townsend, chief executive of Enterprise, said: “This amendment, which was not supported by the Government, threatens to have serious unintended consequences for publicans and the industry at large.”
The British Beer and Pub Association warned 1400 pubs would close and 7000 jobs would be affected.
Punch Taverns, said, in a statement to the stock market: “We believe that the amendment would be likely to have the effect of reducing pub investment, reducing consumer choice and exposing tenants to higher fixed rents, reduced levels of support and greater risk of failure.”Reuse content