Terra Firma Circles £300m deal for Stonegate Pub Portfolio

Private equity firm Terra Firma Capital is understood to be preparing a bid of approximately £300 million for a portfolio of several hundred of Stonegate Group’s highest-performing pubs, CLH News can reveal.

The bid, which is expected to be tabled within days, would target around 300 sites from Stonegate’s so-called ‘platinum’ tier — venues identified as the strongest performers across the pub giant’s sprawling estate.

Terra Firma is believed to be one of several prospective acquirers engaged in the competitive sale process, which is being managed by investment advisory firm Eastdil. The process forms part of a broader debt-reduction strategy at Stonegate, which late last year moved to offload a tranche of its freehold estate.

The company had initially explored the sale of as many as 1,000 freehold sites from its portfolio of more than 4,500 pubs — a collection that analysts had valued at around £1 billion in total.

Terra Firma is led by Richard Hands, son of the firm’s founder Guy Hands, who built a reputation in private equity through high-profile investments in businesses including music major EMI, care home operator Four Seasons Health Care, and Annington Homes, the company that formerly held a large portfolio of Ministry of Defence residential properties.

Stonegate itself is backed by TDR Capital and has grown significantly since its formation in 2010, when it launched with a base of 333 pubs. The group now operates in excess of 4,500 venues across the UK under a collection of well-known brands including Slug & Lettuce and Be At One. Its current scale was largely shaped by the 2020 acquisition of Ei Group, a deal that dramatically expanded its footprint across the licensed on-trade.