Administrators seek buyer for 25 pubs across North East and Yorkshire after collapse of operator

A rescue buyer is being sought for a group of 25 pubs across the North East and Yorkshire amid the collapse of the company behind them.

Administrators were this week called into the owner of the Millstone Hotel in Gosforth, Dirty Habit in Whitley Bay and The Priory in York, among 22 other venues. All 264 staff have been kept on as the portfolio belonging to Milton Portfolio Property 3 Limited continues to trade.

Now, Ryan Grant and Howard Smith of insolvency specialist Interpath Advisory, who have been jointly appointed both administrators of Milton Portfolio Op Co 3 Limited and receivers of the properties owned by Milton Portfolio Property 3 Limited, say they are looking for a suitor of the business and assets.

Property investment and hotels firm Aprirose, the parent of the Milton companies, acquired the former Wear Inns pubs five years ago in a £22.4m deal with Business Growth Fund and NVM Private Equity. A subsequent reorganisation took place in which the properties were transferred to Milton Portfolio Property 3 Limited while running of the pubs was left to Blackrose Management Ltd, a subsidiary of Aprirose. The pubs, including sites in Newcastle, York and Sheffield among other locations, are now due to be marketed in a bid to recoup funds for creditors.

The administrators have said the venues are strong performers and most recent accounts for the owners say the business has historically been highly profitable and cash generative. But the documents, signed by director Manish Gudka, who is CEO of Aprirose, show the impact of Covid restrictions and net liabilities, at the time, of £2.7m and it is understood to have faced financial pressures since.

A review within the accounts says: "Since pubs were finally allowed to re-open, most recently from mid-April 2021, they have again returned to profitable trading whilst the lingering effects of Covid coupled with ongoing cost pressures due to the energy crisis, high inflation and rising interest rates continue to affect customer attitudes and spending. Further funding received from investors in combination with further Government backed loan facilities through the Recovery Loan Scheme have been received and utilised to finance a capital expenditure programme to transform a number of the company's pubs, enhancing their performance.

"Despite ongoing uncertainty surrounding the journey back to normality, the directors believe that trading in general will continue to slowly."

Ryan Grant, managing director at Interpath Advisory, said: "This is a portfolio of profitable, strong performing and established pubs, comprising 21 freeholds and four long leaseholds, located across the North East of England and Yorkshire. We will be appointing selling agents in due course, with a view to bringing the portfolio to market at the optimum time to realise maximum value for creditors."

The full list of pubs involved includes:

Black Bull, East Boldon

Black Bull, Morpeth

Britannia, Houghton-Le-Spring

Cross Keys, Washington

Dirty Habit, Whickham

Dirty Habit, Whitley Bay

Elephant, Ashington

Greens, Sunderland

Guide Post Inn, Springwell Village

Lambton Arms, Chester-le-Street

Lloyds Arms, Grimsby