Greene King and M&B set to be among bidders for Orchid pubs

According to The Sunday Times, M&B and Greene King will be joined by Spirit in bidding for the group’s food-led outlets, which are believed to make up c.170 of the company’s c225 sites.

At the same time, Starwood Capital, Colony Capital and a third unnamed private equity group, which is believed to have a track record in the leisure sector, will bid for the whole of the Rufus Hall-led company, with offers for the business due today.

Backer Deutsche Bank and Orchid’s management team would prefer an outright sale placing the private equity group’s in pole position for the business, which is being advised on its options by Sapient Finance.

Breakaway​

Deutsche Bank took control of Orchid in 2012 after a financial restructuring of the group, which was formed in 2006 as a breakaway from Punch Taverns and initially backed by US investment fund GI Partners.

The company, which is believed to be generating ROI of 40% on its capex programme, is thought to have also considered exploring an IPO after holding meetings with a number of investment banks earlier this year.

Subscribers to the Publican's Morning Advertiser​'s sister title M&C Report​ can read a comment piece by editor Mark Wingett​ on whether the tenanted sector is set to overtake the managed pub sector in terms of M&A activity.