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Enterprise buys tranche of Whitbread pubs
Enterprise Inns, the tenanted pub operator, is to buy 439 pubs from the former Whitbread estate sold to Morgan Grenfell Private Equity (MGPE) earlier this year. The board of Enterprise, which will boost its estate to more than 3,000 with the £262.5m purchase of the unbranded pubs, also confirmed that it is in advanced negotiations for further acquisitions to be funded by a £60m rights issue. Chief executive, Ted Tuppen, says that Enterprise would be 'comfortable operating 6,000 pubs' and city analysts believe that part of Scottish and Newcastle's 650-strong estate put up for sale in January is Enterprise's next target. Of the latest acquisition, chair Hubert Reid, says pubs will complement the group's existing estate: 'The acquisition represents an excellent fit with our existing portfolio and continues our strategy of selective value-enhancing acquisitions.' Enterprise has grown vastly from the 486 outlets at flotation in 1995. Shares have reflected the increased portfolio starting at 145p and rising to the current 520p price. In the six months to 31 March 2001, pre-tax profits rose 16 per cent to £26.4m and turnover jumped by a quarter to £41.9m. The sale of the pubs indicates that MGPE may divest further tranches of the former Whitbread estate, bought for £1.625bn in April. Chief executive of MGPE's new pub division, Ian Payne, says the disposal represents the first step in 'unlocking the full potential' of its operations.
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