Mitchells considers Punch deal

Embattled British pubs group Mitchells & Butlers today confirmed talks to buy the managed pub business from its rival and former takeover suitor Punch Taverns.

Mitchells will consider selling a minority stake in its business in order to fund the deal, after receiving a number of approaches from buyout firms.

However, the troubled 'All Bar One' and O’Neill’s pubs operator reportedly faces opposition from key shareholders over the plans.

Property billionaire Robert Tchenguiz, who is thought to own a 23.5% stake in the group, is concerned that a merger with Punch’s Spirit arm could significantly undervalue Mitchells’ property portfolio, according to The Daily Telegraph.