Jobs at risk as Greene King and Spirit Pub Company combine

Greene King chief executive Rooney Anand, left, shaking hands with Mike Tye, chief executive of the

Greene King chief executive Rooney Anand, left, shaking hands with Mike Tye, chief executive of the Spirit Pub Company, outside Spirit's headquarters in Burton uponTrent following the sale deal. - Credit: Archant

Jobs are at risk at Greene King following a major acquisition earlier this year.

The UK’s third largest pub owner, based at Bury St Edmunds, said it would be working to keep redundancies to a minimum as it unveiled plans this week to integrate its business after acquiring Spirit Pub Company in Burton upon Trent in June.

The brewer and pub owner underlined the “central” role of its Bury St Edmunds operation as it consulted with 1,300 staff across the two businesses over proposals to combine them.

Under its plans, all the headquarters functions from the two businesses would be located at Bury, which currently has a 1,000-strong workforce including 400 within the brewery side of the business, while the two companies’ managed pub division would be based at Burton. Bury would also keep the combined firms’ tenanted and leased pub business.

Employees at the Bury St Edmunds site were told yesterday afternoon, and the 300 staff at Burton today about the integration plans. Its consultation with staff is due to take place for up to 45 days, after which it aims to produce a final plan for the sites.

It is understood that the roles which are duplicated are those potentially at risk, although both firms’ sites will be kept. However, the firm said it couldn’t give any guidance on possible redundancy numbers while the consultation process was taking place as it was “too early” to say. Even when plans are finalised, they will take many months to implement, it said.

“We are working to keep redundancies to a minimum. It’s good news we are proposing to keep both offices and we believe these proposals will lead to a more successful company which is good news for Bury St Edmunds and for Suffolk more broadly,” a spokesman said.

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The Burton site will be the centre for the firm’s 1,900 managed pubs which operate under 14 pub and restaurant brands, including Hungry Horse, Loch Fyne, Old English Inns, Chef & Brewer and Fayre & Square.

A Greene King spokesperson said: “Following the acquisition of Spirit Pub Company in June, we have been working on a plan to integrate the two businesses and combine the best of both. The location of our people is really important so we are proposing to retain both main offices in Bury St Edmunds and Burton upon Trent.

“If confirmed, Bury St Edmunds would remain the company’s headquarters and home to our Brewing and Brands and Pub Partners divisions, along with our group support centre. Bury St Edmunds is central to our 216-year heritage and we think it’s important to continue to be based in our Suffolk heartland.

“We are planning to create a Retail Centre at Sunrise House in Burton given the increased national coverage of the managed pub estate and to equip the business for future growth.

“We are now consulting with employee representatives at both sites on the proposal. If finalised, it means that some functions would move from Bury St Edmunds to be based in Burton and vice-versa.”

Greene King’s £774million acquisition of the Spirit Pub Company made it the UK’s largest player in the managed pubs sector with a total of around 3,100 pubs, including around 1,800 under direct management.

In June, the company posted another year of record revenues, with sales within its key retail division topping £1billion for the first time.

But the most significant development of 2015 for Greene King came after its financial year-end, with the completion of the acquisition of the Spirit Pub Company, which added around 1,200 pubs to the company’s estate.

Group-wide sales for business before Spirit Pub Company for the 52 weeks to May 3 totalled £1.315billion, a 1.1% rise on the reported figure for the previous year and a 3.0% increase on the previous year.

Profits also continued to climb on an underlying basis, although the overall figures were affected by the disposal of 275 non-core pubs and lower like-for-like sales growth.

Enterprise Inns and Punch Taverns remain the UK’s two largest pub owners, with around 5,500 and 4,300 properties respectively, but they are focused on the tenanted sector.

But Greene King has more managed houses than rivals such as Mitchells & Butlers – which owns around 1,700 pubs under brands such as Harvester and O’Neills – and J D Wetherspoon, which has around 920.

The Spirit Pub deal extended Greene King’s lead over Marston’s as the country’s largest integrated pubs and brewing group, with the Marston’s estate numbering around 1,630.