Shares fall again following M&B property move

Greene King's shares fell today to their lowest point since October last year as the markets digested the postponement of Mitchells & Butlers' (M&B) property joint venture with R20.

In a note on the postponement of M&B's R20 property joint venture, broker Goldman Sachs said if M&B was unable to do the deal due to fluctuations in the debt market, "the hopes of peers doing similar deals will be significantly reduced, particularly for Greene King and JD Wetherspoon".

The broker said it didn't expect the share price of either Enterprise Inns or Punch Taverns to be as badly hit, "since their potential uplift comes from the prospect of conversion to real estate investment trusts", although it acknowledged stock would likely fall after the M&B announcement.

At one point today shares in Greene King were trading at 951p, 29p down, their lowest since the end of October last year.

Other listed pubco's saw yet more falls after yesterday's declines. JD Wetherspoon's shares were down 8.5p at 573p, while Punch Taverns were down 19p to 1097p and Enterprise Inns' shares were 0.9 per cent lower at 650.5p.

At its preliminary results announcement early last month Greene King said it was looking to enter into "an OpCo/PropCo structure with a joint-venture partner for all or a proportion of the unsecuritised part of the estate [872 pubs] which may deliver the best balance between realising value and retaining some operational control".

The group was unavailable for comment as to whether it would follow M&B and put its own joint venture proposals on hold.