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Will Stonegate fold?

Stonegate Pub Company, which owns 4,400 pubs across Britain, is facing challenges in finding ways to refinance its debt.

Stonegate, which owns the Slug & Lettuce chain and bought out Ei Group (formerly Enterprise Inns) in 2019 for £1.3 billion making it the biggest British pub company, has reportedly said that it is still looking for ways to refinance £2.2 billion in debt.

In statements given alongside its annual report, as reported by The Telegraph, Stonegate said: “Since the refinancing plans haven’t been executed, there is an indication that a material uncertainty exists that may cast significant doubt on the company and group’s ability to continue as a going concern […]”.

Despite the reports, speaking to the drinks business, David McDowall, CEO of Stonegate, followed up his words with a few reassurances, largely in the shape of how each of the business divisions is thriving.

McDowall told db: “Our all-round performance exemplifies the strength and depth of the Stonegate estate, with our outstanding Craft Union and L&T divisions continuing to lead the way.”

McDowall has also additionally highlighted that the group’s performance gives him “real confidence in the future” and amplified to db that he is “looking forward to building on this momentum in the months ahead”.


Stonegate is currently the UK’s biggest pub and bars group and queries over its overall health as a business contribute to  trade unease and the stark reminder of how the hospitality industry has been struggling since the pandemic and myriad rising costs and waning consumer spending having a knock-on effect.

Stonegate revealed that it has not yet agreed new loans to replace debts that are due to be repaid in June 2025 and, while talks with potential lenders are reportedly underway, the business has needed to be open about its financial position when it published its recent annual report.

According to the statement shared by Stonegate, the group “may be unable to realise their assets and discharge their liabilities in the normal course of business”.

The business is domiciled in the Cayman Islands and owned by the private equity firm TDR Capital which also owns Asda and became the largest pub group in the UK after absorbing Ei’s sites. Despite this success, the deal also included £1.7bn of debt and completed just before Covid-19 hit the UK and led to a series of lockdowns that closed many hospitality venues for an extended period.


It is understood that Stonegate has been seeking ways to refinance its debts since February 2024 when Bloomberg reported that it had appointed bankers at Evercore and lawyers at Kirkland & Ellis to assess the business and explore the options.

Despite this, the hospitality sector has seen its margins squeezed due to rising costs and diminished consumer spending amidst the cost of living crisis. The evidence of the struggles are also being reflected in the sheer number of pub closures and insolvencies in the brewing sector that are also being hit by rising costs.

Shrugging off concerns over the fiscal situation Stonegate is currently finding itself in and rounding back on his former statement, McDowall told db: “We have been very clear that we continue to work towards achieving our long-term balance sheet goals, with the successful refinancing of a portion of our estate in December marking a significant strategic step towards this.”

He added: “We would also like to assure our valued employees and partners that venues are not at risk as a result of this process.”

Last September, Stonegate revealed that it would begin charging 20 pence more for drinks in peak business hours to cover its rising costs, in a move dubbed to db as ‘potentially fatal’ to the trade.

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