Stonegate weighs selling more than 1,000 pubs as billions in debt threaten its future

Britain’s largest pub operator is reportedly considering the sale of more than one thousand venues as it struggles under a towering debt burden. Stonegate Group, the company behind well-known high street chains including Slug and Lettuce and Be At One, is believed to be exploring a major sell-off in an attempt to stabilise its finances and secure its future.

Stonegate owns around four thousand three hundred venues across the country, making it the biggest player in the sector. Reports suggest the company has been in discussions with advisers as it weighs the possibility of selling some of its most valuable pubs in a deal understood to be worth around one billion pounds. The move would represent a significant shift for a business that has spent more than a decade expanding through acquisitions.

Despite generating more than one point seven billion pounds in revenue last year, Stonegate has built up debts exceeding three billion pounds. The scale of the company’s borrowings has become a pressing concern, particularly as costs have risen sharply across the hospitality industry. High interest rates, wage increases, and soaring operational expenses have all intensified pressure on pub chains nationwide.

The potential sale of one thousand and thirty-four pubs is widely seen as a rescue effort intended to keep the business from collapsing. It follows an earlier unsuccessful attempt to sell venues in twenty twenty three. That deal fell through, leaving Stonegate to refinance one thousand pubs with the debt firm Apollo in order to keep the company afloat. The refinancing came with a non-call period that prevented the sale of those pubs, but that restriction is due to end in January. The change has prompted fresh consideration of all options available to the group.

Stonegate has not publicly confirmed any details of a sale, but sources suggest the company is actively reviewing its position. Its owner, TDR Capital, a private equity firm that also controls supermarket chain Asda, has played a major role in shaping the pub company’s aggressive expansion over the past decade. Stonegate was formed in twenty ten after TDR purchased more than three hundred pubs from Mitchells and Butlers. The company then embarked on a steady series of acquisitions that transformed it into a dominant force in the sector.

This expansion reached its peak in twenty nineteen with the merger of Stonegate and Ei Group, then the largest pub company in the United Kingdom. The move created a vast estate of venues across both urban and rural areas. However, the timing proved difficult. The merger was followed by the outbreak of the COVID-19 pandemic, which forced pubs to shut for months at a time and inflicted immense financial damage across the industry.

Although pubs reopened after restrictions lifted, the economic landscape had changed significantly. Rising energy prices, increased staffing costs and shifts in consumer spending have made the recovery challenging for many businesses. Stonegate has faced these pressures on a massive scale due to the size of its estate. The company recorded a loss of more than two hundred and fourteen million pounds in twenty twenty-four, highlighting the extent of the financial strain.

Industry analysts say any large-scale sell-off would reshape the pub sector and could lead to considerable changes in the ownership of well-known venues across the country. Some of the pubs under threat are understood to be among Stonegate’s most profitable sites, which could attract interest from rival chains or investment groups.

For now, the future of more than one thousand pubs hangs in the balance as Stonegate considers how best to navigate its substantial debt. The coming months are likely to be critical in determining whether Britain’s biggest pub group can regain its footing or will be forced into a far more drastic restructuring of its empire.