Punch Taverns Announces Terms of $3.9 Billion Debt Restructuring

By Katie Linsell

Punch Taverns Plc (PUB) released the full terms of its plan to restructure 2.3 billion pounds ($3.9 billion) of debt.
The U.K. pub operator is asking stakeholders to vote in favor of the proposals at meetings on Sept. 17, according to a statement from the Burton-Upon-Trent, England-based company. It said the plans already have the support of investors that own or control about 65 percent of notes across its Punch A and Punch B securitizations and about 54 percent of its equity share capital.
Punch said the restructuring will cut debt by about 600 million pounds. The company plans to allow some junior creditors to exchange notes for new securities, cash and shares and intends to sell new stock to be allocated between seven funds including Angelo Gordon & Co., Avenue Europe International Management LP, and Oaktree Capital Management LLC.
“It is of critical importance that shareholders and noteholders vote in favour of the resolutions in order to implement the restructuring and avoid the
adverse consequences for the Group of the restructuring not proceeding,” Punch Chairman Stephen Billingham said in the statement.
The latest proposals are “broadly similar” to those announced on June 26, according to the statement. Punch needs to reach a deal with shareholders, all classes of noteholders, and other creditors including Royal Bank of Scotland Group Plc, Lloyds Banking Group Plc and Citigroup Inc. by Oct. 14 or risk default.

Photographer: Jason Alden/Bloomberg

The pub industry was already suffering from a decline in beer consumption following a... Read More

The owner of more than 4,000 pubs started negotiations with shareholders and bondholders in October 2012. It’s trying to lower its debt burden after the U.K. recession hurt the pub industry, which was already suffering from a decline in beer consumption following a smoking ban and competition from supermarkets selling discount alcohol.
Punch has 16 classes of notes across two securitizations operated by independent boards.