Punch Taverns is to acquire Mill House Inns, the chain of 82 pubs in the South and Midlands, in a £164m deal. Mill House's portfolio consists primarily of freehold and long-leasehold neighbourhood pubs with food-led trade. Punch will pay £169m for Millhouse, which includes the assumption of £5m in cash, and will fund the purchase through short term borrowing facilities. In a statement, it said it expects the acquisition to be earnings accretive in its first full year of operation. In January this year, Punch acquired the Spirit Group for £.7bn, and will integrate the Mill House pubs into the three go-forward Spirit segments: value food, premium food and quality local. As at July 2006, Mill House generated an unaudited run rate outlet EBITDA of £16.2 million (before central costs and overheads) and had gross operating assets of £147m.
