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Black Sheep Brewery acquired out of administration for circa £5m: Black Sheep Brewery was acquired out of administration by investment firm Breal Group last month, for a total consideration of £5.04m, Propel has learned. Black Sheep announced at the start of May that it would be appointing administrators after struggling to attract investment. Breal soon emerged as the leading contender to acquire the brewery, which was founded in 1992 by Paul Theakston and operates four pubs. The sale went through at the end of May, with the new Black Sheep Brewing Company trading as Black Sheep Brewery and continuing to produce its beers. In a report by administrators Teneo, it states that the companies’ trading performance suffered during the covid-19 pandemic and trading challenges continued as a result of the current economic environment (including the cost of living crisis and inflationary cost pressures). It said: “In mitigation to the challenges faced, and to protect the business, the companies made use of government schemes including Coronavirus Business Interruption Loan Scheme (CBILS) and Recovery Loan Scheme (RLS) funding, made a business interruption insurance claim, increased supply to supermarkets and developed an e-commerce platform to boost sales, following the mandatory closure of hospitality venues due to covid-19. However, demand did not recover to pre-covid levels, and the companies also faced cost input inflation. As a result, the companies continued to experience cash flow difficulties. The companies had been loss making since FY20. An Ebitda loss of £1.6m was incurred in FY23, with losses forecast to continue into FY24.” The business instructed advisors, Spark Advisory Partners, to run an equity raise process in November 2022, which was designed to attract investment via a rights issue for existing shareholders, alongside the opportunity for new shareholders to subscribe to new shares. This equity raise process was unsuccessful. The report continued: “Following the failed equity raise, Teneo were instructed by the companies to consider all options available to the companies, including a merger or acquisition of the companies and an offer period under The Takeover Code commenced on 11 April 2023. The offer period ceased on 27 April 2023 following a robust and extensive marketing exercise (led by Teneo) which resulted in no offers for the shares being made, however, four indicative offers to acquire the business and assets were received. Two further offers were received subsequent to the end of the offer period. The companies’ filed notice of intention to appoint administrators (NOI) on 2 May 2023 to provide protection from enforcement action as regards HMRC’s circa £1m arrears (including circa £0.34m relating to the formal HMRC TTP agreement). Further NOls were filed on 17 May 2023 to allow time to deliver the pre-packaged sale of the companies’ business and assets.” Breal subsequently acquired the business and certain assets of the companies for £5.04m – £5.03m for Black Sheep Brewery and £10,000 for its retail arm.

Latest edition of Propel’s Turnover & Profits Blue Book to feature updated figures for 31 companies: The latest edition of Propel’s Turnover & Profits Blue Book will feature updated figures for 31 companies. Premium subscribers will receive the next edition of the Blue Book tomorrow (Friday, 9 June), at midday. It now features 736 companies that are turning over a total of £46.2bn. A total of 493 companies are making a profit while 243 are making a loss. Sector companies are making a collective profit for the first time since covid. The Blue Book shows the total profit of the 736 companies in the list is £2,834,963,916 and losses are £2,774,327,505. The Blue Book is updated each month and ranks companies by turnover, profit and profit conversion, listing directors’ earnings for the past five years. Premium subscribers also receive access to four other databases: the Propel Multi-Site Database, produced in association with Virgate; the New Openings Database; the Who’s Who of UK Food and Beverage; and the UK Food and Beverage Franchisor Database. Companies can now have an unlimited number of people receive access to Propel Premium for a year for £995 plus VAT – whether they are an operator or a supplier. The single subscription rate is £495 plus VAT for operators and £595 plus VAT for suppliers. Email jo.charity@propelinfo.com to upgrade your subscription. Premium subscribers are also to be given exclusive access to the recording and slides to Propel Multi-Club Conferences. Premium subscribers also receive their morning newsletter 11 hours early, at 7pm the evening before; regular video content and regular exclusive columns from Propel group editor Mark Wingett.

Students don’t want to stay out late and get drunk anymore, says pub boss: Students in university towns are not staying out as late or drinking as much as they used to because of the high cost of living and a better work ethic, the boss of City Pub Group has said. Clive Watson, chief executive at the company, which runs more than 50 pubs across Britain, told The Telegraph students were coming home earlier from nights out. He said: “Students work a lot harder than they [did] at university in my day… they have a better work ethic, plus they’re having to pay for a lot of it themselves.” Watson said partly this was due to young people worrying more about their health and the high cost of living. He said: “They don’t want to catch Ubers or necessarily [pay for] higher price drinks at two o’clock in the morning. If you can have fun in the pub up until midnight, they don’t need to go off to a late-night bar and carry on the fun. I think they’re having that fun earlier in the evening, they’ve brought their clock back.” Even beyond students there has been a broader shift away from late-night drinking, Watson claimed. “The days before covid, of everyone staying out later and later to two o’clock, going out at nine, going to a pub and then going off to a late-night bar or club or whatever, there’s definitely been a shift away from that,” he said. “People don’t want to wake up on Sunday morning at 11 o’clock. They want to get on with their days, whether it’s a health thing or whatever they’re doing.” He claimed the trend of ending nights out earlier had benefited pub companies like City Pub Group, which has tweaked its drinks menus to try and appeal to people drinking sooner by adding more cocktails.

TRG non-exec director to step down: The Restaurant Group (TRG) has announced that Alex Gersh, an independent non-executive director and chair of its Audit Committee, has informed the board of his decision to step down as a director with effect from 1 July 2023 due to other work commitments. Gersh joined the board on 23 February 2021 and is currently also a member of TRG’s nomination and remuneration committees. Loraine Woodhouse, who has been a member of the board since 4 July 2022, will take over the role of audit committee chair following Gersh’s departure, with effect from 1 July 2023. Ken Hanna, TRG chairman, said: “On behalf of the board, I would like to thank Alex for the contribution he has made to the company over the last two-and-a-half years.”

Shortage of workers is easing, survey reveals: The UK’s red-hot labour market is showing signs of cooling, with falling vacancies and higher availability of candidates reported last month. The Times reports a closely watched survey of the jobs market, carried out for KPMG and the Recruitment and Employment Confederation, found that wage inflation slowed and there was a drop in permanent staff employment in May. The labour market has defied the pressure from rising interest rates, with unemployment staying close to record lows and companies complaining of a shortage of workers that has helped to drive up wages. But there is tentative evidence that companies are finding it easier to hire as the total number of vacant jobs falls from historical highs reached last summer. The REC survey found that vacancies fell for the third consecutive month in May, while the number of candidates applying for a job was at the highest average since the pandemic hit in 2020. Starting salaries for new employees also declined at the fastest pace in two years, suggesting that employers are moderating their pay deals as they are able to attract more candidates. The UK has suffered from worker shortages caused in part by Brexit and long-term health problems forcing people out of the jobs market. This trend of falling labour force participation has begun to reverse slightly as more students have begun looking for work in recent months. Claire Warnes, partner at KPMG UK, said that businesses were delaying hiring decisions and often opting to retain temporary employees rather than hire permanent staff. “The jobs market remains subdued, with the latest survey results showing dampened hiring activity amid ongoing economic concerns,” Warnes said.