Laurel heads the pack for 6C pubs

Laurel Pub Company is working on an audacious bid for the Six Continents pub division Mitchells & Butlers (M&B).​

The managed company is one of a clutch of parties vying for the 2,000-strong pub division ahead of the planned demerger.

Another group, private equity specialist BC Partners, is thought to be working on a rival offer in conjunction with Martin Grant, the former Inn Partnership boss.

A third party, CVC Capital Partners, has appointed Goldman Sachs to advise it on a possible bid.

Laurel is poised to submit an offer for the leisure giant's pub division, which includes brands such as All Bar One, Ember Inns and Harvester, before April 14.

This is the date that Six Continents plans to rubber-stamp the demerger of M&B from its hotels business.

It was anticipated that any buyers would wait until after the split, but last week one industry observer said: "Everyone will be working frantically because it's much easier to buy a division of a group that it is to an entire public company."

Under the leadership of chief executive Ian Payne, Laurel has appointed Rothschild as bid adviser.

It is thought to have secured debt arrangements with two banks, and is currently in talks with several potential equity partners.

If successful, the acquisition would see Laurel move from 630 managed houses to 2,700 overnight.

It is thought Laurel would look to extract value from the M&B estate through a series of sale-and-leasebacks, similar to the deal it did last year with 300 of its existing outlets.

It would also look to rationalise the number of brands within the business, concentrating on a number of core-growth drivers.

Elsewhere, reliable sources backed a report that said Martin Grant had teamed up with BC Partners to work on a rival bid, but the former Vaux executive is keeping tight-lipped. "I have nothing to say. It was just a story in a newspaper," he told thepublican.com.

Before Hugh Osmond's £5.6bn takeover bid for the entire Six Continents group was defeated, equity firm CVC Capital Partners was also looking at a similar deal.

Now CVC is said to be focusing its attention on the 2,050-strong M&B.

Despite the best efforts of Six Continents to press ahead with the demerger of its InterContinental Hotels arm from the pubs business by April 14, it looks like M&B will be sold via an auction.

Last week John Denning, former Voyager boss and Bass pubs' executive, signalled his interest in collaborating in a bid with a private equity house.

Another company that could make a play for the business is Spirit Group, backed by the deep pockets of US equity firm Texas Pacific. Texas already has a significant stake in the business, headed by Karen Jones.

M&B is thought to have an enterprise value of at least £2.8bn.