Almost 450 pubs in London face closure after one of the UK’s biggest hospitality groups Stonegate warned on its profitability, the GMB Union has claimed.
It comes after the operator of over 4,000 pubs – including the Slug and Lettuce and All Bar One chains – raised concerns about its £2.2bn debt pile.
The Stonegate Pub Company which is owned by private equity group TDR Capital, there is a risk its debt cannot be refinanced by its July 2025 deadline. The group also owns supermarket Asda.
“There is an indication that a material uncertainty exists that may cast significant doubt on the company and group’s ability to continue as a going concern for the going concern assessment period,” Stonegate said in a recent account filing.
GMB union flagged debt concerns back in January, warning it could place 19,000 jobs at risk.
Moreover, Gary Lindsay, boss of TDR Capital, told the Business and Trade Select Committee in January he was “confident” £2.6bn of debts in the Stonegate Pub Company could be refinanced this year.
GMB has since written to Lian Byrne MP, chair of the Business and Trade Select Committee, asking him to recall TDR bosses in light of the profit warning.
Stonegate has 447 pubs across London in areas such as Hackney, Islington and Croydon.
GMB Union’s grave warning comes amid a challenging time for hospitality amid a period of extreme pressure for pub and restaurant groups as they battle a slowdown in consumer spending and rising bills.
Nadine Houghton, GMB National Officer, said: “TDR bosses are private equity gamblers- playing fast and loose with people’s jobs and lives.
“When their risky ventures go wrong, they swan off to their next project, leaving workers and communities to pick up the pieces.
She added: “Now, hundreds of much loved pubs across London are in serious danger of pulling their last pint. “It’s a disgrace.”
A spokesperson for Stonegate, said: “We are really pleased with the performance of the business in 2023, which included a sector-leading Christmas trading period. We have delivered a rise in revenue and a significant increase in profitability.
“We have been very clear that we continue to work towards achieving our long-term balance sheet goals, with the successful refinancing of a portion of our estate in December marking a significant strategic step towards this. We would also like to assure our employees and partners that no venues are at risk as a result of this process.”
They added: “TDR Capital has been and continues to be a supportive investor in Stonegate – developing the business over the last fourteen years into the UK’s largest pub company with 4,500 great venues across the country.”
City A.M. has contacted Stonegate Pub Group and TDR for a comment.