Cairn Homes founder vying with Heineken for UK pub chain

Entrepreneur Alan McIntosh bidding alongside Heineken for Punch Taverns

Cairn Homes co-founder Alan McIntosh has waded into a takeover battle with beer giant Heineken for Punch Taverns, the UK pub group he help start in 1997.

The Scottish entrepreneur's Emerald Investment Partners said it is considering a £1.85-a-share bid for Punch Taverns, which would value the company behind 3,000 pubs at over £400 million (€477 million). Its rival, the Dutch brewer, has said it may offer £1.74 a share in cash for the business.

Shares in Punch Taverns jumped as much as 41.3 per cent in London to £1.815 on Wednesday.

Still, the stock has fallen 97 per cent since a peak in 2007 as UK bars struggle with cheaper supermarket booze, a smoking ban and restrictive drinks-purchasing agreements. Heineken's UK pub unit, Star Pubs & Bars, controls about 1,000 taverns.


Punch Taverns, which loaded up on debt just as the recession hit and the smoking ban came into effect, hasn’t recorded a fiscal year of revenue growth since 2007. Some analysts questioned why Heineken would want to expand its pub business, as owning taverns is more common among microbreweries than major producers.

Leased taverns

Five years ago, Punch Taverns split in two, separating its managed-pub operations into a new listed company, Spirit Pub, that was bought by Greene King in 2014. Punch retained the leased-pub side of the business, and pursued a plan to sell almost half of its 6,000 leased taverns.

Mr McIntosh helped establish Punch Taverns in 1997 and later led its initial public offering in London in 2002, when he was the company’s chief financial officer.

The serial entrepreneur co-founded Cairn Homes in early 2015 with chief executive Michael Stanley before floating the company on the London Stock Exchange that June, in a deal that raised €440 million. It marked the first initial public offering of an Irish home-builder in almost two decades. It has since raised more than €220 million through stock offerings.

Mr McIntosh, who is an executive director of Cairn Homes, has a 3.5 per cent stake in the Irish company through a vehicle called Emerald Everleigh Limited Partnership. The businessman, Mr Stanley and chief operating officer Kevin Stanley are entitled to receive a fifth of the total shareholder return of the company over seven years, subject to its share price rising at a compound annual rate of 12.5 per cent over the period.

Joe Brennan

Joe Brennan

Joe Brennan is Markets Correspondent of The Irish Times