Breal Capital hotly tipped to acquire Black Sheep Brewery

Investment firm Breal Capital is in talks to buy Yorkshire’s Black Sheep following the brewery’s appointment of administrators last week.

Breal Capital, part of the Breal Group, is gearing up to buy Black Sheep Brewery, sources told Sky News. However, there are said to be six or seven other bidders still in the running to snap up the North Yorkshire brewer.

Black Sheep asked interested parties to submit their offers by last Friday 5 May, just days after it filed a notice of intention to appoint administrators. Teneo Financial Advisory is handling the process.

“We have several parties who are excited about working with us in supporting the brand, the business and the people. We are feeling fairly confident in the future,” said Black Sheep CEO Charlene Lyons.

Breal Group, a private limited company registered in Cavendish Square, London, comprises a number of private equity, lending and debt advisory businesses. According to the company’s website, it considers itself to be “a multi-disciplinary equity, lending and advisory services family”.

An unnamed Black Sheep spokesperson told The York Press: “We are talking to a number of interested parties and we expect to be able to make a positive announcement soon. We do not intend to speculate on the results of our ongoing talks at this stage.”

As db reported, the Masham-based brewer entered into administration due to “the pandemic and the sudden rise in all costs”.

Lyons explained: “The business has been hit very hard by the pandemic and the sudden rise in all costs. Covid loans were useful but, in the end, could not sufficiently compensate for reduced cash flow in the long term…

“We have taken the decision to protect the business and its creditors, during this period, by filing a notice of intention to appoint administrators.”

Warning signs began to emerge in February 2023, when the brewer was forced to hike its beer prices by 19.5% due to mounting cost pressures.