Private equity groups and trade buyers have until next week to make their sighting-shot bids for Whitbread’s 235 Beefeater and Brewers Fayre pub restaurants, put up for sale two months ago with an estimated value of between £400 million and £500 million.
Punch, Britain’s largest pub group, is expected to bid along with Mitchells & Butlers, Greene King, Wolverhampton & Dudley Breweries and Robert Tchenguiz’s R20 investment vehicle.
The group will start drawing up a shortlist next month and report progress at the time of the interim results, due around October. Regular adviser Morgan Stanley is conducting the auction.
Alan Parker, the chairman, will tell shareholders at the annual meeting today that the sale process is progressing well and that it has been encouraged by the high level of interest.
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In the 13 weeks to June 1, sales from those business being retained by Whitbread rose 6.9 per cent on the same period a year ago and like-for-like sales were up by 1.6 per cent.
Star turns came from its Costa restaurants and the Premier Travel Inn lodging operations, but the TGI Fridays and Pizza Hut franchise businesses remain under review.
The group said sports group David Lloyd is responding to the changes put in place last autumn with an improved revenue performance.
Mr Parker said Costa has had an impressive start to the year with a 6.5 per cent rise in like-for-likes sales and total sales growth of 23.7 per cent driven by 46 new openings. It will now roll out Costa in China with a joint venture partnership covering Shanghai and Eastern China.
Premier Travel Inn continues to grow sales through a mix of organic growth and aggressive new room openings, which totalled 1,133 in the first quarter. The group wants 45,000 rooms by 2010.
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Mr Parker said that although the second quarter has started slowly the board remains confident about the prospects for Whitbread.
Shareholders will vote themselves a £400 million cash payout and decide on the method of a share consolidation. Whitbread shares rose 17p to 1114p.
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