Endeavour boss offered to sell me pubs, billionaire pubs mogul Bruce Mathieson Senior says

In a major twist to the ongoing brutal public brawl around Endeavour Group, Bruce Mathieson Sr says Endeavour boss Steve Donohue came to him with an offer to sell all the pubs.

In 2000, the Bruce Mathieson Group formed a partnership with Woolworths which led to the ALH Group. Picture: Courier Mail

Pubs billionaire and rebel Endeavour Group shareholder Bruce Mathieson Senior says he was approached by Endeavour boss Steve Donohue three weeks ago to buy back the company’s 354 pubs and hotels and end the bitter public civil war that has erupted around the company.

Mr Mathieson Sr confirmed to The Australian late on Thursday that the informal and preliminary approach by Mr Donohue was made just as the corporate brawl around Endeavour group blew up, but that he told the chief executive he had no interest in “breaking up the farm” with Endeavour best run as a combined liquor retail and pubs business.

“Yes he (Mr Donohue) asked if I would be interested in buying the pubs, and I told him no way,” Mr Mathieson Sr told The Australian.

“Let me put it this way, you’d never sell them, that is just a disgrace, that is just trying to hide how bad the business is. You don’t sell your best assets.

“This (approach) was about three weeks ago, he (Mr Donohue) came to me and said what would my view be and he would get back to me, but he never did, given what I told him.”

It is unknown if Mr Donohue was acting with the Endeavour board’s knowledge or blessing when he made the pubs sale suggestion to Mr Mathieson, the billionaire pubs and pokies businessman who built the pubs group now owned by Endeavour.

The sale of Endeavour pubs and gaming machines would remove a major thorn from the side of Steve Donohue. Picture: David Geraghty

The sale of Endeavour’s 354 pubs and more than 12,500 gaming machines would remove a major thorn from the side of Mr Donohue and the board, freeing them of all the regulatory and gambling headaches associated with these venues and allowing them to instead focus on its liquor chains Dan Murphy’s and BWS as well as its growing portfolio of wineries and the Langton’s wine auction house.

A sale would also allow the board to wave goodbye to Mr Mathieson Sr, who has been a public critic for weeks over what he claims is the company’s poor financial performance and sliding share price with it understood the billionaire having been privately fuming for years over Endeavour’s operations and results.

A spokeswoman for Endeavour told The Australian: “Endeavour doesn’t comment on market speculation”.

It comes as Mr Mathieson Sr, who owns 15 per cent of Endeavour, has fought an increasingly bruising and very public battle with the Endeavour board, led by chairman Peter Hearl, over the running of the company and the decision by former Woolworths supermarkets and liquor boss Bill Wavish to run for the board. Mr Mathieson Sr is supporting Mr Wavish’s bid, with the rest of the Endeavour board – other than Bruce Mathieson Junior – advising shareholders to vote against his election.

Endeavour was spun out of supermarket giant Woolworths in mid-2021, bringing together in the new top 50 ASX company a collection of liquor, wine and hospitality assets led by its retail jewel Dan Murphy’s, as well as Mr Mathieson Sr’s pub empire that he had sold a stake into Woolworths in 2004.

But as a listed company in its own right, Endeavour has attempted to broaden out its business, investing heavily in e-commerce and online platforms as well as buying up wineries such as Josef Chromy, Shingleback Wines and Cape Mentelle.

Privately the Mathieson family have been scathing of the expansion into wineries, arguing there were better investments and return on capital available within its key assets around pubs, hotels and gaming machines.

Endeavour was spun out of supermarket giant Woolworths in mid-2021, bringing together in the new top 50 ASX company a collection of liquor, wine and hospitality assets. Picture: AFP PHOTO/William WEST

Now the private brawl has broken into full public view with Mr Mathieson Sr savaging the Endeavour board, its chair and CEO, backing Mr Wavish as well as consistently arguing he had no interest in seeing the company broken up – just run better.

In the last 12 months Endeavour shares have lost 20 per cent, and from its peak in August 2022 it is down more, to leave the Mathieson family’s stake down more than $400m in value.

Mr Mathieson Sr is considered to be the doyen of pubs, having started with his first hotel in 1975. He has bought and sold about 1000 pubs since, making more money in the sector than any other individual in Australia, though it is his big shareholding in Endeavour that now accounts for much of his wealth.

The billionaire, who grew up in poverty in Port Melbourne and now lives in a beachside mansion on the Gold Coast, is said to be able to size up the value of a hotel just by looking at its place on the map, walking in and instantly calculating how much beer it should be selling based on its rough floor space.

Mr Mathieson Sr has surfed the big upswing in the valuation in pubs in recent years, arguing their scarcity will help maintain their worth for decades to come.

“Almost 70 per cent of the pubs out there were built before the 1940s,“ he has previously told The Australian.

“They are not going anywhere and they don’t go out of fashion. It is not like having to get the latest piece of clothing. Johnnie Walker or Veuve Clicquot, they are always going to be there.

“People want to go to pubs. They want a meal, a drink, a punt and whatever else. It is a great industry and still full of potential.”

Mr Mathieson’s history with Endeavour traces back to a previous joint venture with Woolworths that famously stems from a chance meeting with the company’s former boss, Roger Corbett, in a hospitality suite at the 2000 Sydney Olympic Games.

The joint venture bought hotels in Queensland and then took over ALH, which had been floated on the ASX by Foster’s Group in 2003, and combined with their other interests.

Endeavour has eventually become the biggest operator of poker machines in Australia as well.

Mr Mathieson Sr also owns large landholdings on Melbourne’s fringes, and bought a 9.9 per stake in casino group Star Entertainment in February. His fortune was estimated at $2.9bn on The List – Australia’s Richest 250, published by The Australian earlier this year.

Originally published as Endeavour boss offered to sell me pubs, billionaire pubs mogul Bruce Mathieson Senior says