City Pub Company plans AIM listing in October 2017, reports turnover and Ebitda rise: City Pub Company is to seek an AIM listing in October 2017 after its EIS qualifying period matures. The company, which operates 28 sites through two subsidiaries, City Pub Company West and City Pub Company West, has reported sales have risen 36% to £12,066,000 whilst company Ebitda rose 30% to £1,616,000 in the first half of 2016. The company stated in a note to shareholders: “Since the Annual General Meeting held in May, our two companies have continued to perform well and to expand with new openings and the acquisition of further pubs. Today, across both companies we now operate 28 high quality sites with a further site where contracts have been exchanged. Building on previous success, we have achieved another strong performance significantly ahead of last year as well as budget, and we anticipate further improved performance for the second half of 2016. Our portfolio continues to develop in line with our strategy. It should be noted that eight of our 28 strong portfolio have been open for less than twelve months. Additionally, four sites are currently being refurbished/seeking consent and it is expected that they will be trading within the next four months. The financial benefit of both the acquisitions and developments will be strongly felt in 2017’s financial performance. During the last four years, we have built up a high quality pub estate, well-located in great cities across southern England and further acquisitions have been identified. As part of our growth strategy, we plan to expand our portfolio to thirty five pubs within the next twelve months with the intention of growing our estate to more than 50 pubs in the longer term. Recently we negotiated a new five year, £20m facility to implement our plans from our existing lenders, Barclays Bank. This facility is on improved terms. It is important to emphasise that your board does not wish to have a high level of bank gearing. That is good practice and business, but is especially pertinent given the uncertainty following Britain’s decision to leave the European Union. As our companies continue to grow, we remain focused on improving our purchasing and systems. These improvements will help us in managing an expanding business and will also assist in delivering improved financial performance through better procurement and other efficiencies. It is vital that as we move into next year we achieve the benefits and synergies that are available to a fast expanding group of our size. As part of the board’s objective to provide an effective market for its investors’ shareholdings, it is our intention, subject to market conditions, to list the companies’ shares on Alternative Investment Market of the London Stock Exchange once the EIS qualifying period is completed. This will be executed by merging City East and City West. At that time we intend to raise a further £10-15m of new equity from new and existing shareholders. It is currently anticipated that we will seek a listing of the combined entity once we get to the end of the EIS qualifying period in October 2017. Over the course of the next year, we will be ensuring all the necessary ground work and preparation has taken place to ensure a successful listing on AIM. We are fortunate to have members of the board with extensive experience of listed companies and we are confident that our strategy of building a high quality pub estate in excess of 50 pubs will be an continuing attractive investment proposition for both new and existing shareholders. As part of this preparation, the current directors’ bonus scheme will be revised. The original scheme for directors was implemented at the launch of the EIS scheme (15% of the company Ebitda) when we were a much smaller company. The board have therefore decided to revise these arrangements to be more appropriate for a larger company and more consistent with those of a listed company. This will be implemented when the company lists. We have a well experienced head office team who is used to working in an environment of rapid expansion. Rupert Clark and Alex Derrick both CEO’s of City East and West respectively, have built teams capable of delivering high levels of retail performance and the board is confident that they will be able to continue this for many years to come. It has been another exciting, enjoyable and successful period for our two companies. We look forward to the challenges of continuing to build and expand the companies. The recent acquisitions, our increased of focus on better systems and purchasing and our improved bank facilities give us a real opportunity to continue our growth and to seek a successful listing onto AIM when we get to the end of the EIS qualifying period.”

Shareholder groups back AB InBev £79bn takeover of SABMiller: Two influential shareholder advisory groups have come out in support of Anheuser-Busch InBev’s (AB InBev) £79bn takeover of rival brewer SABMiller. Glass Lewis has recommended SABMiller shareholders support the takeover when they vote in a fortnight, despite the controversial two-part nature of AB InBev’s offer, which is designed to soften the tax hit suffered by the two biggest shareholders in the London-listed beer giant. It comes after International Shareholder Services (ISS), another corporate governance group, advised SABMiller investors vote in favour of the deal on Wednesday, 28 September. A revolt among SABMiller shareholders over the terms of the takeover, which were first agreed last autumn, forced AB InBev to lift its bid to £45-a-share in July. Investors were unhappy that sterling’s plunge following the Brexit vote meant the takeover increasingly favoured tobacco firm Altria and Colombia’s Santo Domingo family, which together own about 40% of SABMiller. At least two minority SAB shareholders – Aberdeen Asset Management and Vontobel – remain opposed to the deal, spurring speculation other investors will vote against it later this month. Because AB InBev’s offer treats Altria and the Santo Domingos differently from the rest of SAB’s shareholders, the pair have been excluded from the vote, making it easier for other investors to block the deal if they wish. SAB needs 75% of the remaining 60% of shareholders to approve the takeover, which will see the world’s number one and two brewers combine. The takeover has generated a record $1.5bn in fees for bankers, lawyers and public relations firms acting for both brewers. It will result in at least 5,500 job cuts, however, as AB InBev squeezes $1.4bn in annual savings from the deal within four years.