Whitbread and M&B in restaurant and hotel swap

Whitbread has made a deal with pub operator Mitchells & Butlers to exchange 44 of its pub restaurants for 21 Express by Holiday Inn hotels.

The asset swap will see Whitbread​ re-name the hotels under its Premier Inn brand taking the number of rooms to over 38,000 in 550 hotels. The company has also applied for planning permission to develop five of the 21 acquired hotels, adding around 200 new rooms.

M&B​ will re-brand Whitbread`s pub restaurants, mostly Beefeaters and Brewer`s Fayres, to its own brands which include Ember Inns, Harvester, Sizzling Pub Co. and Toby Carvery.

Both companies said the 1,700 staff working at the affected sites will simply transfer to their new operators on September 19.

Whitbread Chief Executive Alan Parker said: “Acquiring this well located, modern hotel estate will enable us to re-brand quickly, drive occupancy, increase profits and extend the number of rooms at these hotels by at least 20 per cent.

“We are exchanging these pub restaurant sites because we have been unable to develop a Premier Inn alongside, which was the reason for retaining them”.

Tim Clarke Chief Executive of M&B said the company`s brands will "add a lot of value to these pub restaurant sites as we have shown with previous acquisitions."

The exchanged assets are estimated to be worth £78m and the transaction is expected to be earnings neutral in 2009/10.

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