Britain’s biggest pub company to slash jobs amid debt crisis

14 June 2025, 19:14 | Updated: 16 June 2025, 09:55

Britain’s largest pub company is set to cut a number of jobs as bosses move to streamline the debt-ridden firm following Rachel Reeves’s tax crackdown.

Slug & Lettuce owner Stonegate Group has been working with restructuring specialists at AlixPartners over recent months, according to recent reports.

The company, which runs more than 4,000 pubs across the UK including the Craft Union brand, are expected to cut 150 jobs across its head office and central functions, according to The Telegraph.

It is understood no decision has yet been made on the exact number of roles under threat.

Jobs in its pubs and bars will not be affected and no pubs will close as a result of the restructuring.

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The news follows a more challenging period for Stonegate, which is owned by TDR Capital, the private equity house which also controls Asda.

It has lost hundreds of millions of pounds while straining under the weight of a near-£3bn debt pile while higher taxes levied on employers by the Chancellor this year have added to pressures.

Despite growing revenues in recent years, it reported pre-tax losses of £257m and £214m in 2023 and 2024 respectively as interest payments on its debts pushed it into the red.

A Stonegate spokesman said the planned cuts were partly due to a shift away from managed pubs – which it owns and operates itself – towards leased and tenanted pubs, which are rented out to and operated by publicans.

The latter have proved more profitable for Stonegate in recent years.

Managed pubs also require more resources and head office staff to oversee, making them less appealing to run at a time when the company is trying to return to profit.

The spokesman said: “This, combined with rising costs, particularly after the recent Budget, means we must reorganise our support functions to reflect the shape of our business today.

“We recognise that this is a difficult time and we are committed to supporting our colleagues with care and fairness as we consult with the business on the proposed changes.”

Hospitality firms have also faced challenges in extra costs after Ms Reeves raised employers’ National Insurance contributions and lowered the threshold at which they are paid this year.

Bosses have argued the latter has disproportionately hurt hospitality firms because of the number of lower-paid and part-time workers they employ.

It will be the second round of job cuts at Stonegate in two years following more than 250 redundancies in 2023. Stonegate has also been reviewing rents and agreements with suppliers as part of restructuring efforts.

Last summer, Stonegate was able to push the repayment date for much of its debts to 2029, after TDR refinanced and invested £250m into the company to avoid defaulting on its debts.

At the time, Stonegate said the deal would allow it to invest more in its pubs.