By Andrew Starke
Listed pub group National Leisure and Gaming (NLG) may have had a year it would rather forget but managing director, Andrew Jolliffe, is confident the company is well placed to benefit from ‘the still largely fragmented hotel industry in Australia’.
Addressing shareholders at NLG’s annual general meeting at the recently refurbished Keighery Hotel this week, an upbeat Jolliffe said the group’s portfolio of 36 hotels remained a strategically significant and attractive platform.
He also paid tribute to NLG’s lenders, who will ultimately determine the future of the debt-ridden pub group, calling National Australia Bank’s support ‘strong and invaluable’.
“I would also like to highlight my sincere appreciation to the BNZ / NAB for the indefatigable, significant, and imperative support of NLG in its endeavour to return value to all NLG’s shareholders,” Jolliffe said.
He acknowledged that the company was continuing to explore options that would allow it to restructure its debt and that negotiations with third parties were ongoing.
Speculation has been rife that gambling giant Tabcorp could make a bid for the pub group as a signal of its intentions to become a major Australian hotel operator.
One of the options under consideration has been the prospective purchase of some or all of the Hedley Leisure & Gaming Property Fund (HLG but now renamed Redcape) freehold interests in NLG pubs.
However Jolliffe acknowledged that this would require a very substantial recapitalisation of NLG in order to facilitate such a purchase.
“The industry is undergoing a further period of consolidation, and NLG is well positioned to participate in that as the fourth largest pub portfolio in the country,” he said.
NLG shares stood at 2.9 cents at midday today (Dec 2), down from 3.1 cents seven days ago.