The Grocer – 24 August 2019

Get the full story at thegrocer.co.uk 24 August 2019 | The Grocer | 9

Former PM David Cameron famously treated

Chinese president Xi Jinping to a pint of Greene

King IPA on a state visit back in 2015, but it isn’t

a taste for the brewer’s signature beer that has

persuaded Hong Kong’s richest man to shell out

£2.7bn to buy up the pub group.

On Monday, brewer and pubco Greene King

announced it had accepted an 850p per share bid

by Hong Kong listed international conglomer-

ate CK Asset Holdings – controlled by billionaire

Hong Kong tycoon Li Ka-shing.

The deal represents a 51% premium on Greene

King’s previous closing price of 563p, and saw the

shares shoot up to 850p on the announcement.

A statement from the bidder hailed the UK

pub and brewing sector as an “important part of

British culture”. However, the likelihood the Hong

Kong conglomerate has developed a passion for

pints and pies seems remote. Instead, it is Greene

King’s hefty property portfolio that attracted its

attention.

Greene King owns the freehold or long-dated

leasehold for more than 80% of its properties and

the group recently carried out a revaluation of

its property estate, bolstering its market value to

£4.5bn against a book value of £3.5bn. It’s telling

the enterprise value the bid places on the entire

Greene King business is £4.6bn – pretty much the

same as the value of its properties.

“It’s a whopping premium that implies CKA

sees significant value in the property portfolio,”

said Neil Wilson of Markets.com. “While it’s a bot-

tle of champagne for shareholders, there may be

fewer reasons to celebrate for patrons. I think we

can comfortably expect more pub closures.”

Elsewhere, Ocado was boosted this week by JP

Morgan hailing its business as a “superior eco-

nomic model” to its more conventional rivals.

Ocado shares were up 4.6% on Monday to

1,204p after the broker raised its target price on

the shares to 1,073p, as it suggested the online

supermarket is now at the topping point of turn-

ing profitable.

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Farmdrop has now raised a

total of £25m since launch

Local farm-to-consumer
food delivery service
Farmdrop has secured
further multimillion-
pound backing to con-
tinue its nationwide
expansion push.
The startup, which
aims to link fresh food
producers directly to cus-
tomers, has issued just
over £5m worth of new
shares as part of a sec-
ond Series B fundraising
drive.
The new funding
brings the total raised
by Farmdrop since
its launch in 2014 to
over £25m, following

Farmdrop adds £5m of growth

funds as it expands across UK

three previous invest-

ment rounds in 2016,

2017 and 2018 as well as

an initial campaign of

crowdfunding.

Previous backers

included venture capi-

tal firm Atomico – led by

Skype founder Niklas

Zennström –, LGT

Impact Ventures UK and

Belltown Ventures, as

well as Zoopla founder

Alex Chesterman and

Asos co-founder Quentin

Griffiths.

Farmdrop used the

earlier cash injec-

tions to expand its ser-

vices beyond London,

launching in Bristol, Bath

and Manchester.

The business grew rev-

enues by 86% to £3.9m in

the year ended June 2018.

However, it still has to

generate a profit, having

reported a pre-tax loss of

£7.8m last year.

Elena Cherubini
Vegan petcare sup-
plier Hownd is seeking
funding to accelerate
growth and develop
new dog treats and
supplements.
The manufacturer of
vegan dog grooming
products and vegetar-
ian hemp-based treats is
looking to raise £150k on
Crowdcube in exchange
for a 6.4% stake, valuing
the business at £2.2m.
Within three days of
launching, the campaign
had raised over £80k
from 75 investors.
Hownd plans to use
the cash raised for NPD

• including germ-free
  accessories, additions to
  its dog treats range and
  new chewing natural
  supplements.

Vegan petcare brand

Hownd turns to crowd

for £150k fundraise

“There is a lot of

excitement for the brand

over the next couple

of years,” co-founder

Mark Hirschel said.

“Consumers are demand-

ing meat-free ingredi-

ents in petfood and we

are seeing this more and

more.

“We would like to take

on a wider variety of dog

treats and we want to get

into the petfood category,

but we have to do it

right.”

If it hits its initial

fundraising target,

Hownd is willing to over-

fund up to a maximum

of £500k. The investment

would be used to make

“key hires” to its team,

and improving sales,

marketing and operating

functions.

Expanding its interna-

tional presence was also

a key priority for the busi-

ness, which is currently

available in 17 coun-

tries, including the US,

Australia and Belgium.

Hownd’s product range

is currently stocked by

Pets at Home, Ocado and

Amazon in the UK, as

well as a number of inde-

pendent retailers and

grooming salons.

Hownd plans to use the

funds to help push NPD

GREENE KING SHARES

Dates: 22 August 2018 – 22 August 2019

900

800

700

600

500

400

A S OND J FMAM J J A

2018 2019

EXCITED HOWND

We want to get into the petfood category, but we have

to do it right – Mark Hirshchel, co-founder, Hownd