Stonegate Group Looking to Sell More Than 1,000 of its Pubs Amid £3 Billion Debt Battle

Britain's biggest pub operator, Stonegate Group, is reportedly gearing up to sell more than 1,000 pubs as the company struggles under debts of more than £3 billion ($3.9 billion) and a relentlessly tough trading climate.

The owner of Slug & Lettuce and Be At One is said to be exploring a massive sale that would involve nearly a quarter of its 4,300 venues, in what insiders describe as one of the most dramatic shake-ups the UK hospitality sector has seen since the pandemic.

1,034 of Stonegate's Top Sites Could Bring in £1 Billion

According to The Times, bosses have been holding discussions with advisers as they assess whether to offload 1,034 of Stonegate's best properties, which industry figures believe could fetch up to £1 billion ($1.3 billion).

It follows a previous attempt in 2023 to sell a similar number of pubs. The deal did not go through and Stonegate instead refinanced around 1,000 venues with the debt firm Apollo to inject fresh cash into the business.

A Stonegate spokesperson told The Sun that no sites are at risk of closure and that pubs continue to operate as normal under the Stonegate brand. The venues under review remain open and trading.

End of Loan Restrictions Triggers Fresh Sell-Off Plans

The company is now reconsidering its options because a non-call period on the Apollo loan, which prevented Stonegate from selling pubs, is due to end in January.

That deadline has renewed pressure on the group, which turned over more than £1.7 billion last year but remains burdened by the debt linked to its 2019 merger with rival Ei Group. The merger created the UK's biggest pub chain but left the company in a vulnerable financial position just months before the Covid pandemic forced nationwide shutdowns.

23 Pubs Already on the Market with Business-as-Usual Assurances

As part of its routine portfolio review, Stonegate has already put 23 sites up for sale.

A company spokesperson told The Sun: 'As the UK's largest pub company, we regularly review our portfolio for divestment opportunities. This package being marketed by Savills is a business as usual transaction.'

Pandemic Hangover and Soaring Costs Hit Pubs Hard

Stonegate's difficulties mirror wider problems across the hospitality sector. Since the end of the pandemic, pubs have been hit by high interest rates, increased employee costs and rising food and energy bills.

The chain suffered a £214 million ($281.5 million) loss in 2024, which led chief executive David McDowall to introduce a transformation plan to return the company to profit. The strategy has involved converting hundreds of managed pubs into tenanted and leased sites that are run by individual publicans. These leased pubs are considered more resilient and less costly for the company to operate.

UK Pub Sector Faces Continued Pressure

Stonegate is not the only operator feeling the strain. Many pubs and restaurants across Britain are battling the ongoing effects of the pandemic and the cost-of-living crisis.

Earlier this year, Oakman Inns and Restaurants went into administration, putting 19 sites at risk of closure. The Coconut Tree also faced winding up after defaulting on its Company Voluntary Agreement, and popular pasta group Officina 00 shut three locations.

Rising living costs have reduced how much customers can afford to spend at their local pubs, while operators face increased expenses in every part of their business. Many chains have been forced to raise prices simply to stay afloat, placing further strain on pubs and their customers.