Within minutes it had backfired. Other comments about the UK’s largest pub company were significantly less polite. Days earlier, Stonegate had been named as the subject of an investigation by the industry regulator, the Pubs Code Adjudicator (PCA) over alleged mistreatment of the tenants who run more than 3,000 of its venues.
Melissa Phillips’s father, known locally as “Phil”, was one of them. After taking over a more or less derelict venue in Basingstoke, Hampshire, he renamed it Laarsen’s, an anagram of his beloved Arsenal FC, and turned it into a highly successful football pub that the company cited to trainee publicans as a success story. But after he began suffering from the effects of Alzheimer’s, he lost his ability to keep on top of the business.
Stonegate knew of his condition from 2022, she claims, yet the process of allowing him to exit the tenancy agreement dragged on until 2024, weighing him down with added stress and financial burdens. Melissa said much of this debt was amassed during a period in which Stonegate knew her father no longer had the capacity to make financial decisions. Earlier this year, a survey of pub tenants by the PCA found that Stonegate, which also owns the Slug & Lettuce, Be At One and Walkabout chains, was considered by tenants to be by far the worst large company to lease a pub from.
It scored a satisfaction rating of 39%. The next worst was Punch Pubs, with a rating of 55%, while Admiral Taverns and Greene King scored 72% and 71%, respectively. The criticism comes as the company wrestles with a £3.8bn debt pile, mostly racked up when it bought Enterprise Inns for £3bn just before the pandemic in 2019, taking on thousands of tenanted pubs in the process.
Stonegate is domiciled in the Cayman Islands and ultimately owned by TDR Capital, a private equity firm that is also the majority owner of Asda. The pub group has lost £650m in the past three years but in June it reported its strongest first-half profits ever, saying adjusted earnings were up from £17m to £201m in the 28 weeks to 12 April. However, the company has struggled to shake off complaints about its behaviour in “tied” tenancies, complex agreements under which businesses such as Stonegate lease the premises to a publican.
Under these deals the publican is meant to receive benefits such as a lower rent and support with repairs and upkeep in exchange for buying certain products – most notably beer – exclusively from the pub company. In practice, tenant publicans and their loved ones say they have been left severely out of pocket and mentally exhausted by their interactions with Stonegate. The Guardian has spoken to more than 10 pub landlords who claim to have suffered poor treatment by the company.
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