Brewer and pub owner Greene King said it had reached an agreement on a recommended offer for Britain's Spirit Pub Company, valuing Spirit Pub at about £773.6m.
The proposed deal would result in Spirit Pub shareholders owning about 28.9% of the combined new Greene King. On October 30, Spirit Pub said it had agreed to extend the deadline for the takeover offer until November 4.
Spirit Pub last month rejected a takeover approach from cider maker C&C Group but gave the Irish firm a month to submit a formal offer to challenge the Greene King bid.
Greene King is shifting its focus to its own-managed retail business, comprising restaurants, hotels and pubs, as it competes for a bigger slice of the dining market and to that end is reducing its tenanted and leased estate.
Spirit Pub, which was spun out of Punch Taverns in 2011 and runs chains such as Chef & Brewer, Fayre & Square and Flaming Grill, is split into 794 managed pubs and 433 leased pubs.
Managed pubs account for nearly 90% of the group's revenue.
Greene King and Spirit Pub will also benefit from a larger exposure to the economically stronger London and southwest regions of Britain, while the combined group could expect to achieve costs synergies of at least £30m a year, Greene King said today.
