Disposal

RNS Number:5514H
Honeycombe Leisure PLC
16 February 2003


16 February 2003

                             HONEYCOMBE LEISURE PLC

                   MANAGEMENT AGREEMENT WITH PUNCH TAVERNS &

                                SALE OF 12 PUBS



                      "A NEW TEMPLATE FOR THE PUB SECTOR"



Honeycombe Leisure plc ("Honeycombe"), the North West managed pub operator,
announces that it has sold 12 of its freehold sites (the "Sites") to Punch
Taverns plc ("Punch Taverns") for a cash consideration of #11.72m. Under the
terms of the transaction, Honeycombe has also entered into a 20 year agreement
with Punch Taverns, whereby Honeycombe will continue to manage the Sites.

For the year ended 28 April 2002, the Sites generated earnings before interest,
tax and depreciation of #1.67m. The Sites had a net book value of #10.4m as at
27 October 2002 and, accordingly, the sale will give rise to an exceptional
profit on disposal, of #1.1m after costs, for the year ending 30 April 2003.The
net proceeds from the disposal will be used to reduce Honeycombe's borrowings,
with Honeycombe's resultant gearing expected to fall from 263% to 180%. In due
course, Honeycombe expects to announce further disposals of surplus non-income
earning assets as well as a small number of trading units that are producing
below average returns.

James Baer, Chief Executive of Honeycombe commented:

"This transaction represents a significant milestone in Honeycombe's strategic
development.  Not only does the transaction reduce substantially Honeycombe's
bank borrowings but, more importantly, it also establishes a relationship with
Punch Taverns, the UK's second largest pub owner, and provides a potential
template for future deals by which Honeycombe can grow its estate without the
need to raise further equity or take on additional debt."

Commenting on the transaction, Giles Thorley, Chief Executive of Punch Taverns,
said:

"We are very pleased with this transaction.  We have admired the quality of
Honeycombe's operation for some time and have been discussing with them ways of
developing a mutually beneficial relationship.  This transaction brings together
the finance and capital capability of Punch with the retailing skills of
Honeycombe.  We see this as a template for similar deals in the future."

Honeycombe will continue to own and operate a core estate, but will actively
seek to increase its pubs under management through its management agreements
with Nectar Taverns, through further university site deals with Jarvis and
through its relationship with Punch Taverns.


Enquiries to:


Honeycombe Leisure PLC

James Baer, Joint Chief Executive                    Tel: [phone]
Bryan Wardman, Joint Chief Executive
Paul Snape, Finance Director

Holborn

Simon Rothschild/Tarquin Edwards                     Tel: [phone]




                      This information is provided by RNS
            The company news service from the London Stock Exchange
END

DISDDGDDRSBGGXU