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Pub Securitization In The Works

04 May 2003

BondWeek is the leading news publication for fixed-income professionals, covering new deals, structures, asset-backed securities, industry and market activity.

Mitchells & Butlers, a Birmingham, U.K.-based operator of pubs, may be looking into securitizing all or part of its 2,100 pub estate, according to market participants. The amount of cash M&B is seeking to raise could not be learned. Calls to Karim Naffah, finance director at M&B were referred to Kate Holligon, head of investor relations, who did not return calls.

M&B was formed last month after it was spun off from Six Continents. The company has appointed Royal Bank of Scotland as its debt structuring advisor. M&B's pub estate is said to be worth roughly £3 billion. RBS has organized several pub deals over the years. Calls to Andrew Burton at RBS were not returned.

Separately, last week, Scottish & Newcastle announced its intention to sell its pub estate. Its 1,450 pub estate is said to be worth about £2.5 billion. According to press reports, several bidders have already shown interest in the estate including M&B, Nomura International, Pubmaster, Punch and the Laurel Pub Company. Nomura, Pubmaster and Punch have all used securitization in the past.

04 May 2003