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Tchenguiz lifts M&B stake to 29.77% after slide in it's share price
Mitchells & Butlers (M&B) activist investor Robert Tchenguiz has upped his total holding in the company to 29.77% after buying further so-called contracts-for-difference (CFDs) with no voting rights, taking advantage of the recent slide in Mitchells & Butlers' share price .
The purchase of more CFDs was undertaken through Violet Capital Trust, which is wholly owned by the Tchenguiz family.
Tchenguiz now holds an economic interest in the pub operator via CFDs representing 26.77%, plus an interest in 3% of the company’s ordinary shares. UK takeover rules oblige an investor holding more than 29.9% of a company's shares to offer to buy the rest.
Shares in the operator of the All Bar One and Harvester pub chains have fallen sharply since May, when M&B appointed two non-executive directors from Tchenguiz’s investment vehicle R20, Tim Smalley and Aaron Brown, to "boost its property financing expertise".
M&B has indicated it plans to become a real estate investment trust (Reit) when it is able.
Last week, Fuller’s chairman Michael Turner has waded into the debate about M&B's future.
He told journalists at last week’s results meeting he thought it was “very interesting” what was happening at M&B and contrasted it with the “long-term” view at Fuller’s.
There is nothing long-term about a Reit, he said. “It’s very unfortunate,” said Turner.
“It’s not good for the industry – it’s not good for consumers.”
Asked what he meant, Turner added: “By definition, the operating company is bound into high street leases.
"I think everybody is aware of what’s happened to companies with high street leases.
"The best example is Laurel, which is giving two directors to M&B.”
There is much speculation on what Mr Tchenguiz could be up to, Leslie Zarka, an analyst at Citigroup, suggested that M&B may well do an asset swap with Whitbread, the hotel operator in which Mr Tchenguiz has recently built an economic interest.
The swap would involve M&B selling its Innkeeper's Lodge hotel chain to Whitbread, owner of Premier Inn, in exchange for the latter's pubs.
"We are not saying it's going to happen, but there just seemed to be one coincident too many," said Ms Zarka.
The purchase of more CFDs was undertaken through Violet Capital Trust, which is wholly owned by the Tchenguiz family.
Tchenguiz now holds an economic interest in the pub operator via CFDs representing 26.77%, plus an interest in 3% of the company’s ordinary shares. UK takeover rules oblige an investor holding more than 29.9% of a company's shares to offer to buy the rest.
Shares in the operator of the All Bar One and Harvester pub chains have fallen sharply since May, when M&B appointed two non-executive directors from Tchenguiz’s investment vehicle R20, Tim Smalley and Aaron Brown, to "boost its property financing expertise".
M&B has indicated it plans to become a real estate investment trust (Reit) when it is able.
Last week, Fuller’s chairman Michael Turner has waded into the debate about M&B's future.
He told journalists at last week’s results meeting he thought it was “very interesting” what was happening at M&B and contrasted it with the “long-term” view at Fuller’s.
There is nothing long-term about a Reit, he said. “It’s very unfortunate,” said Turner.
“It’s not good for the industry – it’s not good for consumers.”
Asked what he meant, Turner added: “By definition, the operating company is bound into high street leases.
"I think everybody is aware of what’s happened to companies with high street leases.
"The best example is Laurel, which is giving two directors to M&B.”
There is much speculation on what Mr Tchenguiz could be up to, Leslie Zarka, an analyst at Citigroup, suggested that M&B may well do an asset swap with Whitbread, the hotel operator in which Mr Tchenguiz has recently built an economic interest.
The swap would involve M&B selling its Innkeeper's Lodge hotel chain to Whitbread, owner of Premier Inn, in exchange for the latter's pubs.
"We are not saying it's going to happen, but there just seemed to be one coincident too many," said Ms Zarka.
Fri, 13th Jun 2008