Greene King, Spirit Pub agree on $1.24 bln takeover offer

Nov 4 (Reuters) - Brewer and pub owner Greene King Plc (LSE: GNK.L - news) said it had reached an agreement on a recommended offer for Britain's Spirit Pub Company Plc (LSE: SPRT.L - news) , valuing Spirit Pub at about 773.6 million pounds ($1.24 billion).

The deadline for the takeover offer was extended last week to hold further talks.

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 Plc (LSE: PUB.L - news) in 2011 and runs chains such as Chef & Brewer, Fayre & Square and Flaming Grill, is split into more than 750 managed pubs and 450 leased pubs. Managed pubs account for nearly 90 percent 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 30 million pounds per annum, Greene King said on Tuesday.

Spirit Pub 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. ($1 = 0.6252 British pound) (Reporting by Aastha Agnihotri and Neil Maidment; Editing by Gopakumar Warrier)