Laurel to go under hammer

MidOcean Partners , the private equity firm that operates Laurel Pub Company, is to start a formal auction for the business. Laurel, which now runs 177 high-street pubs and bars, is expected to go on the market for around £150m. MidOcean Part-ners has appointed NM Roths-child to conduct the auction. The decision by MidOcean to start a formal auction follows concerted attempts to sell the business to bidders during the sale of its 432-strong neighbourhood pub estate during the spring. It is understood that none of the four neighbourhood bidders ­ Spirit, Punch, Wolves & Dudley and Greene King ­ wanted Laurel's high street division. One analyst said: "I can't see any of the quoted companies buying Laurel's high-street pubs. There's not a lot of growth in this business." Laurel chief executive Ian Payne and his chairman John Lovering are expected to be among the bidders for the business. Payne and his management team already own a significant chunk of Laurel. The Laurel boss has spoken in the past of his desire to lead the consolidation of the high street. GI Partners, the US private equity group that funded the management buy-out of Yates Group, is expected to take an interest in the package. However, Yates chief executive Mark Jones has insisted the company would spend a year getting used to being private before making any acquisitions. Laurel is already selling 17 pubs held on short leaseholds on an individual basis. Of the remaining 160 pubs, around half are freehold pubs. The Hog's Head brand accounts for 60 of the sites in the Laurel estate with Casa and RSVP the next biggest brands with 20 sites between them. Laurel was re-financed by Royal Bank of Scotland and Barclays after the sale of its neighbourhood estate and has debt of around £110m. Mean-while, Britain's biggest managed operator Spirit is poised to sell 300 pubs, many of them on the high street, as it prepares for a possible flotation next year. Spirit, which bought the S&N Retail estate last year, will be aiming to boost its per pub average sales figure by selling pubs at the bottom-end of its estate. The Spirit pubs are expected to attract interest from Punch, Wolves & Dudley and Greene King. Spirit has already raised £536m with the sale of the Premier Lodge chain and 19 pub restaurants to Whitbread for £536m.