Punch Taverns rules out solo bid for rival Mitchells & Butlers

Punch Taverns has ruled out a solo bid for rival Mitchells & Butlers (M&B) but could still strike for the managed pub company as part of a consortium, it said today.

Punch confirmed that it had submitted outline terms for a merger with M&B back in February.

However, it stated that it no longer believed such a tie-up would be favourable for its shareholders.

Despite this, the company, which is the UK's largest pub operator by number of units, said it remained in talks with third parties about a combined bid for M&B and wouldn't at this stage rule itself out entirely.

"Punch is assessing whether any such proposal would maximise value for shareholders," it said in a statement to the City.

M&B's future was thrown into doubt in January after the company was hit with a £274m post-tax loss from the closure of a disastrous property hedge fund.

M&B forced to defend cash position >>

Hedging and Mitchells & Butlers explained.. >>

Joint bidding for Mitchells >>

Mitchells & Butlers chairman to step down in May >>

By Chris Druce

E-mail your comments to Chris Druce here.