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Pubs draw attention in U.K.
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June 28, 1999: 10:58 a.m. ET
Investors focus on four separate deals; Whitbread mulls higher offer for Allied pubs
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LONDON (CNNfn) - U.K. investors were left swimming in beer talk Monday, with four separate pub deals vying for their attention.
In the biggest deal in the sector, the leisure company Whitbread was holding talks with its advisers to decide whether to add a cash element to its all-stock bid for the 3,500-strong pub portfolio of Allied Domecq.
London-based Whitbread's approved bid has run into trouble since privately owned Punch Taverns made a hostile 2.7 million pound ($4.27 billion) cash offer last week.
Although Allied rejected Punch's attempt to spoil the party, Whitbread has seen the value of its offer slip along with its share price. At current levels, the deal is only worth around 229 pence per Allied share versus Punch's valuation of 258 pence.
Whitbread needs to make any move soon -- Allied shareholders are due to vote on the two bids Friday.
Regional deals
Investors also have some smaller deals to ponder. Regional brewer and pub operator Morland Monday recommended a 145 million pound bid made last week by larger rival Greene King after it failed to attract any other firm offers.
But the process was immediately clouded by a statement from Britain's largest regional brewer, Wolverhampton and Dudley Breweries, which said it may still try to trump Greene King's bid.
Wolverhampton said it had requested information "with a view to investigating the possibility of making an offer at a higher price than that already recommended by the board of Morland." A newspaper report Sunday suggested the brewer was lining up a 160 million pound bid.
Pubs swallowed
Swallow Group, formerly known as Vaux, took the final step in its restructuring program by selling its 662 pub portfolio in the north of England to privately-owned Pubmaster for 127.5 million pounds. Swallow will concentrate on its hotels, engaging in some limited pub business
A possible deal involving two smaller brewers listed on the U.K.'s Alternative Investment Market -- a less regulated investment exchange for smaller companies -- has Jennings Brothers confirming it's in advanced talks to buy pub operator Cafe Inns for about 8.2 million pounds.
-- from staff and wire reports
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