Australia's Woolworths buys stake in pub owner

SYDNEY (Reuters) - Australia's No. 1 retailer Woolworths Ltd (WOW.AX: Quote, Profile, Research, Stock Buzz) said on Monday it has bought a 19.9 percent stake in Ale Property Group LEP.AX, the country's largest pub owner.

Woolworths, already a hotel and pub owner, will pay A$3.34 for each Ale share, valuing the stake at A$57 million ($54 million). It is buying the stake from property fund Hedley Leisure and Gaming Trust (HLG.AX: Quote, Profile, Research, Stock Buzz).

The retailer said the stake was "strategic" and it had no intention of increasing it. Any increase above 19.9 percent would require Woolworths to make a takeover offer for Ale under takeover laws.

Ale listed in 2003 after purchasing the pub properties owned by beverage company Foster's Group Ltd (FCL.AX: Quote, Profile, Research, Stock Buzz) for A$536.2 million.

ALE has 103 properties, which are leased to pub business Australian Leisure and Hospitality, a group 75 percent owned by Woolworths.

(Reporting by Jonathan Standing, editing by James Regan)