TPG offloads Punch Taverns stake

Texas Pacific Group (TPG) has sold its entire interest in the UK-listed pub chain, selling 54m shares to institutional investors.

US private equity house Texas Pacific Group has exited UK-listed pub group Punch Taverns, selling its remaining stake in the business on the London Stock Exchange.

In a statement this morning, TPG confirmed it had sold its 21.8 per cent stake, amounting to 54m shares, to institutional investors. The firm invested in Punch from its TPG Partners II, TPG Parallel II, TPG Investors II and TPG 1999 Equity Partners II funds.

Merrill Lynch was bookrunner of the Punch IPO in May last year with Deutsche Bank and SSSB as global managers. Punch Taverns' market capitalisation at the offering price was £570m, and its enterprise value, including net debt of £1.4bn, was £2bn.

The sale price for the transaction has not been disclosed, although the shares are currently trading at a considerable premium to the price at the time of the initial public offering. Punch shares were floated at 230p and last night reached a high of 435p. Following the sale, they fell in value to 413.75p.

Punch was created in 1997 with the purchase of the leased pub business of Bass, which now trades as Mitchells & Butler. Two years later it added the leased pub estate of drinks group Allied Domecq. Last month the firm acquired Pubmaster for £1.2bn, making it Britain's biggest pub landlord.