Mitchells & Butlers buys 22 Ha Ha Bar & Grills in £19.5m deal

All Bar One and Harvester owner Mitchells & Butlers yesterday announced a £19.5 million deal to buy 22 Ha Ha Bar & Grill restaurants.

M&B is buying the chain from Bay Restaurant Group, but will not keep the brand under plans to convert the Ha Ha leased sites into 12 All Bar One, six Browns restaurants and four into other existing M&B brands.

However, while it will axe the Ha Ha name, M&B confirmed it planned to take on all retail and operational staff employed in all the sites being bought.

Bay Restaurant said the deal will allow it to focus solely on Spanish tapas group La Tasca, following its move in February to offload the Slug & Lettuce business to the Town & City Pub Company.

Commenting, Adam Fowle, M&B chief executive, said: "Whilst small, this acquisition illustrates our ability and strategy to develop sites to create value for Mitchells & Butlers shareholders. It will also provide an excellent opportunity to grow significantly two strong brands."

Ian Payne, chairman of Bay Restaurant, said: "The sale of Ha Ha follows a successful and active auction process, which we launched in April of this year.

"As anticipated, there was significant interest in the Ha Ha brand portfolio and I am delighted to see both the business and all of its employees going to such a good home."

The Ha Ha sale highlighted the consolidation taking place in the casual dining sector.

Ha Ha employs around 800 people and was launched in 1999. It is based in locations including Bath, Bristol, Cardiff, Norwich, Portsmouth and Reading.

The sites will allow M&B to concentrate on the food-led market as part of a move away from pure drinks pubs, which have suffered since the smoking ban and the recession.

M&B, which also owns Toby Carvery, announced the sale of more than 300 sites and a 39m deal to offload the Hollywood Bowl ten-pin bowling business.