M&B looking to raise up to £500m through pub sell-off

Private equity firms are understood to be lining-up to back operators who want to buy some of the hundreds of pubs being sold by Mitchells & Butlers (M&B).

The managed pub operator is having a clearance sale of up to 300 of its non-core pubs, hoping to raise up to £500m in the process.

The pub group has yet to confirm reports that it has hired Sapient Corporate Finance, the finance firm headed by corporate deals specialist Peter Hansen, who has advised the likes of Punch Taverns on several key disposals in recent years.

Following M&B chairman John Lovering's strategic review of the group's operation earlier this year it decided to focus on its food-led retail brands, with many new developments designated to be located on retail parks and other similar mass-market sites.

Those formats that do not fit the Lovering template - as well as those that cannot be made to fit it - will be earmarked for disposal.

As soon as the review was concluded it is understood that several operators approached M&B with a view to picking off assets the group considered non-core.

These are believed to include a number of late-night bar operations including Flares, as well as the student-oriented Scream chain.

A number of private equity firms are believed to looking to back existing bar operators, such as Novus Leisure and Town & City, to pick up some of the sites.

While M&B wants to focus on six key food-led retail brands, it is believed that the London-based Nicholson's pub chain is not among those up for sale.