West Midland pub companies Wolverhampton & Dudley Breweries and Punch Taverns were on opposite sides of a fresh wave of consolidation in the industry yesterday.
Wolves was on the "buy" side of the equation with a £13.7 million bolt-on acquisition of English Country Inns.
Punch, based at Burton-on-Trent, was on the "sell" side with a £14.8 million disposal of 45 pubs to Admiral Taverns.
Wolves pounced on English Country Inns (ECI) only two days after losing out to rival Greene King in a bid to take over Belhaven, Scotland's biggest regional brewer.
Based in London, privately held ECI operates 14 unbranded food-centred pubs in central and southern England, including one at Albrighton only a few miles from Wolves' base.
The offer of 128p per share represents a par for the course economic value to sales multiple of 2.2, according to James Dawson, an analyst at broker Charles Stanley.
"The historic earnings generated by ECI have been poor and the heavy administrative burden of running a small estate such as this one has hindered performance," Mr Dawson, who rates Wolves' shares a "buy", said.
"However, W&DB appears well positioned to develop these pubs and remove considerable unnecessary costs."
Three or four or likely to be transferred into Wolves' Union Pubs tenant and lease division and the rest will be given the Pathfinder Pubs brand and format.
Wolves, which also owns the the Pitcher & Piano, Bostin' Locals and Service That Suits Me chains, said ECI's outlets were an "excellent fit" with its own managed pubs business.
It is the latest in a series of acquisitions that has seen the company build up an empire of 537 managed and 1,739 tenanted and leased pubs, making it the country's third largest pubs group.
The firm said its purchase of Wizard Inns last year and Burtonwood and Jennings Brothers this year demonstrated its ability to integrate acquisitions and improve their business performance.
Wolves said the ECI deal, which is subject to approval by shareholders, would give it further outlets to sell its own beers.
It brews Banks's, Hanson's and Mansfield beers in Wolverhampton and Marston's Pedigree ale in Burton-on-Trent.
Chief executive Ralph Findlay said yesterday that there could be more to come.
"The pubs sector is set for further consolidation," he said.
"It's a mature market facing intense competition, flat topline sales growth, rising costs and increased competition.
"Many small-tomediumsized operators may decide that the best option for them is to be taken over by a larger chain and Wolves would be interested in that process."
Mr Findlay did not rule a possible bid for the privatelyowned Spirit Group which operates more than 2,000 pubs, bars and restaurants throughout the country, including the Chef & Brewer chain.
Spirit Group could come with a hefty £3 billion price tag, market analysts believe, but W&DB has plenty of financial firepower to call on following the recent securitisation of 70 per cent of its estate plus the negotiation of a new £250 million banking facility.
But it could find itself competing with near-neighbours Punch and Mitchells & Butlers who could make a joint bid. ..SUPL: