Bid speculation surrounding a possible move by Punch Taverns and Mitchells & Butlers for Spirit Group boosted the pair's share prices today.
Punch shares rose this morning by as much as 16.5p (two per cent) to 835p and M&B's rose four per cent to 388.25p as the markets digested the possibility that the pair would make a move for a significant chunk of Spirit's 2,000-odd managed pubs.
Sunday press reports said Punch was expected to team up with Browns' owner Mitchells & Butlers (M&B) before launching a joint £2.5bn offer for Spirit, although the latter's shareholders have played down suggestions there is a conflict over strategic direction for the group.
If it went ahead, a bid for Spirit would be the biggest deal in the pub sector to date.
Punch would be looking to convert outlets into leased sites, while in the event of a successful approach M&B would be taking on food-led pubs similar to its own Harvester brand.
Shareholders in Punch have done well out of the recent bid speculation surrounding Spirit; shares rose 20p last week following a report from broker's ABN Amro that it was looking to seal a deal with the group.
While Punch are believed to be interested in any worthwhile deal in the market the company has made no comment on the likelihood of a bid being made for Spirit in the near future.
There is also speculation that if the Spirit deal were not to come off, Punch chief executive Giles Thorley might look for new opportunities. "He's a deal man, not a pub man," said one commentator.