Fri, 26 Jan 2024 | BUSINESS SALE
Leeds-based brewery North Brewing Company Limited has been acquired out of administration in a deal that saves close to 80 jobs. The company filed a notice of intention (NOI) to appoint administrators earlier in January, after business was impacted by many of the factors affecting UK hospitality and brewing businesses.
In a statement, company founders John Gyngell and Christian Townsley cited COVID-19, Brexit, high interest rates, the cost-of-living crisis, cost increases and unmanageable repayments on the company’s borrowings dating from the COVID-19 pandemic.
Despite saying it was poised to post a profit this year, having fallen to its first ever significant loss in 2022-23, the burden of its debt repayments meant that the company required additional funding in order to continue trading. The directors had explored options including a sale of the business, but took steps to file for administration when it became clear a solvent solution was not possible.
Interpath Advisory’s Howard Smith and Rick Harrison were subsequently appointed as joint administrators of North Brewing Company Ltd, North Brewing Leisure and North Brewing Management Ltd on 25 January 2024.
Upon their appointment, the joint administrators immediately secured a sale of the businesses and assets to Vertical Drinks Ltd and Kirkstall Brewery Ltd (as part of one transaction) in a deal that secures 78 jobs. The acquisition secured the future of the company’s taprooms in Leeds and Manchester, as well as its main brewery in Leeds, but not its Birmingham taproom, which will close.
Following the acquisition, North Brewing Co will continue to operate from its Springwell site as an independent brewery run by its existing management team. The new company will be called Vertical Drinks Ltd T/A North.
Tom Swiers, Head of Food and Drink at Interpath, who advised North Brewing Co on the deal, said: "North Brewing Co is a renowned craft brewer that has forged an excellent reputation over the years for the quality and innovation of its beers.”
“We are pleased to have completed this transaction which represents an exciting tie up of brilliant beer brands based here in Leeds. The deal will allow the group to move forward under new ownership and we wish the purchaser and the management team all the best for the future.”
While there is significant risk inherent in distressed acquisitions, they can also deliver enormous value
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