Global meltdown

30 December 2009 By Neil Unmack Follow @unmack1

Brewers aren’t known for aggressive financial wizardry. But Heineken has made a tidy profit buying the distressed debt of a highly leveraged UK pub vehicle and seizing control. And the benefits to Heineken weren’t purely financial.

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Heineken said on Dec. 23 that it had made a 215 million euro pretax profit from buying back debt issued by units of Globe, a pub company it operates that underwent a prepack administration in October.

The Dutch brewer bought the majority of senior bonds sold by Globe's finance unit, as well as some junior debt and all of the bank debt issued by Globe's management company.

Globe, set up by Robert Tchenguiz, raised 257 million pounds of bonds secured on its pubs in 2006, and a further 230 million of bank debt borrowed against its management company. At the time of the bond deal in 2006 the company forecast earnings before interest, tax, depreciation and amortisation of 36 million pounds.

Globe is to be sold to a new group, EBP Pub Company, in a deal financed by Heineken.

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