Punch Taverns’ good pub, bad pub split hits bondholders

READ IN-DEPTH COVERAGE OF THE ISSUES FACING PUNCH AND ITS BONDHOLDERS

Troubled UK pub group Punch Taverns released its much-anticipated strategic review yesterday with the announcement that it plans to split itself in two. Chief executive Ian Dyson said the firm will demerge its performing managed pub division from its struggling leased pub division – in effect creating a “good pub, bad pub” structure.

Bondholders in the debt-laden company are under no illusions about what this means: they see it as a way for the company to protect the good part of the business from the necessary and painful restructuring that must come for the leased estate.