Wear Inns to inject new life into clutch of pubs

At a time when many pubs are folding, Wear Inns is about to create jobs by investing in pubs across the north of England.

Yesterday, Wear Inns revealed that it had bought nine pubs from TCG Bars for an undisclosed sum.

As a result, Wear Inns’ managed pub estate has grown to 24 premises, and there are plans to acquire more pubs in the near future.

In May, it was revealed that the Business Growth Fund (BGF) and NVM Private Equity (NVM) had committed £10m of growth capital to help Wear Inns snap up under-performing pubs. As a result of the deal, BGF took a minority stake in the business and secured a place on the board.

The newly acquired premises include the Lloyds Arms in Grimsby, Porter Cottage in Sheffield and The White Bear in Barnsley.

Founded in 2006 by managing director John Weir and John Sands, the company’s chairman, Wear Inns buys and manages freehold community pubs across the North East and Yorkshire.

The company’s estate also includes The Priory in York, New Inn in Wetherby, The Sun in Shipley, near Bradford, and the Courthouse in Barnsley.

According to a company spokesman, Wear Inns has a strategy of buying well-located and often underperforming pubs with “huge potential”.

The spokesman added: “The pubs are predominantly wet-led (in other words they are focused on drink sales) and one of the benefits of being managed rather than tenanted is that they have more of a say in the range of products sold. The premises are deliberately unbranded to reinforce the community nature of the pubs.”

Mr Weir said: “We are delighted to acquire this package of well-known pubs.

“The pubs will complement our existing business and enhance our growth strategy.”

He said all the pubs were due to receive capital investment and new retail trading formats.

This is the second deal Wear Inns has done with TCG, after it acquired the Cross Keys in Washington in December 2009.

Mr Weir added: “As we develop we are hopeful of adding another four North East and Yorkshire pubs to the portfolio this year; with more acquisitions planned in early 2013.

“We should also create 40 jobs as the business grows this year, with further jobs expected in early 2013. It has been a complicated process of raising funds and making the acquisitions over the last six months.”

Wear Inns has acquired the pubs with the £10m recently provided by NVM and BGF.

Mauro Biagioni, a director of NVM Private Equity, said: “The Wear Inns’ management team has stuck to its business strategy since 2006, using their experience of the industry to create an estate of unique community pubs that meet the desires of the regulars, as well as passing visitors.

“Wear Inns has increased its value considerably since inception.”

NVM manages more than £200m of funds. Typically, NVM looks to invest between £2m and £10m in each transaction.

David Colclough, investment director at BGF, said: “We will continue to lend our support to the management team as they take the business into its next stage of development.”

BGF invests between £2m and £10m per business in return for a minimum 10 per cent equity stake, and a seat on the board for a BGF director.

The advisers involved in the deal were Paul Mankin and Simon John of PwC, Chris Scott and Andrew Lancaster of KPMG, Duncan Reid and Paul Wigham of Watson Burton, Jamie Pass and Alistair Scott-Somers of Dickinson Dees and Yunus Seedat of Addleshaw Goddard.

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