British pub chain Young’s has purchased 15 Redcomb pubs in a £34m ($38.6m) cash-free and debt-free deal.
Run by Dan Shotton and Mark Draper, Redcomb owns and operates the pubs located across London in Islington, Greenwich, East Dulwich and Paddington Basin.
In May, the company announced the launch of the first of a new generation of urban bars, Alphabet, in Islington.
Founded in 2009, Redcomb generates run-rate earnings before interest, tax, depreciation and amortization of nearly £4m.
Young’s expects the pubs to operate at the current run-rate in the first full year of ownership. It also has plans to invest in the pubs over the next two years, which will have a short-term impact on profitability, the company noted.
The acquisition will enhance Young’s brand and complement the house estate managed by the company in and around London.
According to Young’s, the deal increases its managed estate by 8% from 185 to 200.
The deal will also take Young’s total pub count to 270 pubs with the addition of 70 tenanted pubs in its Ram Pub Company.
Young’s chief executive Patrick Dardis said: “The team at Redcomb, headed by Dan Shotton and Mark Draper, has created an outstanding, well -invested estate of pubs, which we are delighted to add to the Young’s fold.
“The acquisition of these pubs represents an excellent opportunity to continue the growth of the Young’s managed estate. They fit very well with our expansion strategy which is focussed on high-quality managed houses. These pubs are all in prime locations, where our premium offer will work extremely well.”
The transaction has been funded through existing debt facilities with Barclays and HSBC.