Greenalls nets pounds 56m from sale of Cellars

Greenalls, the pub and leisure group, yesterday announced the sale of its Cellars off-licence business to a management buy- out team backed by CVC Capital Partners, the venture capitalists, for pounds 56m.

Nader Haghighi, managing director of Cellars, plans to create a national chain of off-licences and convenience stores through acquisitions and new openings.

"We want to develop our existing concepts by creating a national business and we have the financial support to make acquisitions," Mr Haghighi said.

The deal is likely to herald a further bout of consolidation in the industry.

Analysts believe that Cellars could look to acquire chains such as Threshers, owned by Whitbread, Allied Domecq's Victoria Wine, and Oddbins, run by Canadian drinks giant Seagram.

If the expansion plan is a success Cellars is likely to float on the stock market within the next few years.

Cellars has 460 outlets and 3,300 staff. As well as traditional off-licences trading under names such as Cellars and Berkeley, the group includes Wine Cellar, an upmarket wine shop which includes a Continental cafe, and Night Vision, a chain of video shops which sell alcohol. The group made a pre-tax profit of pounds 6.6m in the year to last September.

Greenalls, which made a pounds 13m loss on the sale, has decided to quit the off-licence business because of growing competition from the large supermarket groups.