The Times ­– Whitbread restricting sale of 250 sites to fellow operators, M&B considered frontrunner: Whitbread is restricting the auction of 250 of its pubs to established pub operators, with Mitchells & Butlers (M&B) being tipped as the frontrunner in the estimated £600m process. The Beefeater and Brewers Fayre operator, which is being advised by Goldman Sachs, the investment bank, is understood to be running a tight process to avoid the uncertainty of a long, drawn-out disposal, reports The Times. While it has not commented, the Premier Inn operator is understood to have approached pub companies including Greene King, Heineken, Marston’s and Punch in what one City source described as “testing the water”. Whitbread is believed to have earmarked about 250 out of its 440 pubs for possible disposal, the majority located next door to a Premier Inn. Many of the sites identified are either marginal or loss-making, while its full-year results in April included impairment losses against 13 standalone restaurants. M&B, which last month Propel tipped as a suitor along with Greene King, reportedly has the advantage of having completed deals with Whitbread twice before. In 2008, it exchanged 21 of its hotels for 44 Whitbread pubs in a straight asset swap involving no cash. Both sides valued their assets at around £78m. Two years earlier, the All Bar One operator completed the acquisition of 239 pubs from Whitbread in a £497m deal. The quality of M&B’s existing estate and excellence of the refurbishment programme rolled out across its estate in recent years have won plaudits for Phil Urban, the chief executive who has led the transformation process. The company, created in 2003 through a demerger from the old Bass brewing empire, has about 650 venues under brands including Miller & Carter and Ember Inns. Analysts cited Urban’s ability to convert Beefeaters to Miller & Carter and Brewers Fayre to Harvester as a big advantage, enabling him to replace “lacklustre” Whitbread brands with successful M&B ones. Stonegate Group, Britain’s biggest pub company, would normally have been expected to look at the Whitbread package but instead is itself in selling mode. Stonegate, which is backed by TDR Capital, the private equity firm, is looking at the possibility of selling between 700 and 800 pubs from its 4,492-strong estate as it considers ways of cutting its £3bn debt. It is understood to have hired Eastdil Secured to advise on options, although sources close to the situation insisted that no decisions had yet been taken. Whitbread was founded as a brewery in 1742 by Samuel Whitbread but it sold its beer business in 1999. The group has about 850 hotels in the UK, Germany and the Middle East. Its UK estate comprises almost 84,000 rooms. At its results in April, customer volumes at its branded restaurants, which are focused at the value end of the market, remained below pre-pandemic levels. Overall food and beverage sales were 40% ahead year-on-year but 4% behind pre-covid levels, with increased spend per head outweighed by a decline in customer volumes. None of the potential suitors would comment or could be reached. Shares in Whitbread closed unchanged at £34.