Irish investors McManus and Magnier back pubs plan to get M&B through Covid-19 crisis         

Mitchells & Butlers, which owns various pub chains including All Bar One, was in a race to raise new funds ahead of a debt repayment scheduled for mid-March.               

Irish investors JP McManus and John Magnier are backing plans for a £350m (€400m) sale of shares by struggling UK pubs group Mitchells and Butlers (M&B), as they aim to get its Covid-shuttered 1,600 outlets through the crisis and reopened under Britain's swift vaccination programme.    

Mr McManus and Mr Magnier hold a stake of around 23.5% in M&B through their vehicle called Elpida and appear intent to maintain their shareholding by participating in the shares raise. 

They have joined with a consortium of other major shareholders to say they are giving their full support to the pub group's management plan, according to a stock market release.               

As part of the survival plan, M&B also plans to secure £150m in new credit lines and has its eyes set on the swift rollout of the vaccines in Britain that could enable the lifting of hospitality restrictions there faster than in other parts of Europe.   

M&B -- which owns the All Bar One, Browns, Ember Inns, Harvester, Miller & Carter, Nicholson's, Sizzling Pubs, Toby Carvery, and Vintage Inns -- was in a race to raise new funds ahead of a debt repayment scheduled for mid-March.               

Shares in M&B climbed 7% to peg back its losses from a year ago to only 15%. That values the Ftse-250 firm at almost £1.5bn. In an update last month, M&B said it had ready cash of £125m, and no other loan facilities available.

"With no sites trading, ongoing monthly cash burn has returned to the level previously disclosed in relation to the last shutdown, at approximately £35m to £40m before payment of debt service (representing interest and amortisation) of £50m per quarter," it said at the time. 

Today, the consortium of shareholders which includes Elpida said it will also work with managers to ensure "that the time and cost devoted to public company matters are reduced". That has sparked comment on the future of M&B as a listed company. Stifel analyst Mark Irvine-Fortescue said the move by the consortium could raise expectations of M&B being taken private.

 "Without this major equity injection, the prospects for the business, its 1,600 venues, and over 40,000 UK employees would be bleak," a spokesperson for the new consortium, called Odyzean, said.