The Investment Column: The pub chain with no theme
Discovery is slightly difficult to categorise, positioned halfway between the managed themed chains such as Wetherspoon and Tom Cobleigh and the groups of tenanted pubs run by the likes of Enterprise and Century. With 45 managed pubs - all maintaining their own character, not a centrally determined theme - and 234 tenanted outlets, Discovery is a bit of both and will presumably be priced as such.
Set up in 1992 as a vehicle to acquire 223 pubs from Whitbread in England and South Wales, the chain has been added to subsequently with purchases from Marstons and Allied Domecq. The focus is now expected to be on expanding the relatively small managed portfolio, but the cash-generative tenanted pubs will remain as a 200-strong core to help fund expansion of the other leg.
After the proposed exit of the original venture capital backers, led by Kleinwort Benson, Discovery is pitching itself to investors (who are frankly beginning to have had their fill of pub chains) as a non-fashion led, traditional chain of pubs, designed not to need regular refurbs and so generate a decent return on capital. It is a commendable resistance to the relentless trivialising of the country's pubs and for that, if nothing else, deserves support.
For less sentimental reasons, Discovery looks likely to be a reasonable bet. Operating profits have grown smartly from 1994's pounds 2.35m to the pounds 5.11m achieved in the year to September and the board has a wealth of experience gleaned from years at Devenish and Courage. All will depend on how ambitious the pricing is next month.
- 1 Forget 'The Dress': Here are five of the biggest news stories you might have missed
- 2 The black and blue dress: Makers considering a white and gold version
- 3 PornHub turns masturbation into energy in bid to save the planet
- 4 The remarkable archaeological underwater discovery that could open up a new chapter in the study of European and British prehistory
- 5 Saudi Muslim cleric claims the Earth is 'stationary' and the sun rotates around it
Boris Nemtsov shot dead: Outspoken Putin critic who had expressed fears for his life is killed near the Kremlin
PornHub turns masturbation into energy in bid to save the planet
Ukraine crisis: Top Chinese diplomat backs Putin and says West should 'abandon zero-sum mentality'
White and gold or blue and black – what colour is the dress? An eyewitness gives a definitive answer
Saudi Muslim cleric claims the Earth is 'stationary' and the sun rotates around it
New theory could prove how life began and disprove God
Half of Ukip voters say they are prejudiced against people of other races
This is what it's like to be dead, according to a guy who died for a bit
'Cash for access' scandal: Sir Malcolm Rifkind says 'unrealistic' for MPs to live on £67,000 salary
'Jihadi John': CAGE representative storms off Sky News accusing Kay Burley of Islamophobia
Ukip would cut billions from Scottish budget to fund English tax cuts
iJobs Money & Business
£40000 - £50000 per annum + pro rata: SThree: SThree Group have been well esta...
£30000 - £37000 per annum: Recruitment Genius: Established in 1999, a highly r...
£250-£300 Day Rate: Jemma Gent: Are you a qualified accountant with strong exp...
£230 - £260 Day Rate: Jemma Gent: Do you want to stamp your footprint in histo...