Saturday, September 15, 2012

Merger Talked Up at GK and M&B

article in Daily Express

Doesn't make any sense at all for M&B and GK to merge really - other than, possibly, in the mind of some suits who'll get massive injections of cash as the 'cost savings' of two groups coming together kick in.

IF they do merge there's a lot of scope for massive cock ups - a lumbering punch drunk beast would be the outcome of the mix - these companies' financial successes are all predicated upon their size - generating enough cash flow to service aged debts securitised on the estates years ago which I guess will be pretty high compared with the cost of money these days, in a market where, no matter how good they make the figures look overall at year end, they can't escape that substantial parts of their estates underperform due to them being intellectually bankrupt and the property's pretty much unshiftable at decent prices (even though M&B valued their estate UP by 2% last year) because no-one's out there buying bulk freeholds any more since the likes of Tchenguiz deservedly got their pants blown off.

As for Alistair Darby, he's the cuddly, diplomatic man of the pub sector but not necessarily a great choice for leading M&B considering what a bunch of cowboys Marston's have proved themselves to be over much of their estate... they've managed to kill pubs all over the country, just like GK and the others have done, by sucking all the profit out of their tenants and running the buildings into the ground. It will be interesting to see what sharp decisions Darby makes over M&B's brands. M&B LOVE brands. M&B water down everything in their passionate drive to build brands.

'Mediocrity & Bullshit; We LOVE building Brands, we've got it covered: from Land's End to John O'Groats'.

On the other hand at that level of the pub sector there's not really anyone else who's got a clue about development, innovation and evolution of the industry. They all rely on their machinery rolling and throwing off cash no matter what they do to screw it up while believing they're geniuses as they dine and wine on their laurels.

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