Mitchells & Butlers is higher in afternoon trading as traders weigh up a report that real estate investor Robert Tchenguiz's R20 company has held talks about selling his interest in the pubs group.
Shares in M&B are up 1.3%, or 4.25p, at 342.5p following the report in this morning's Telegraph.
Analysts at Blue Oar Securities said such a disposal by Tchenguiz could cut the pressure on M&B's management to find a property solution to raise the company's value.
"The company may be even more incentivised to remain independent and, were the stake broken up, it would arguably be more likely to do so," they added.
People in the market believe a sale by Tchenguiz could make it easier for M&B to push through mooted plans with Punch Taverns for a complicated deal that would merge the two pub groups' managed operations while attracting a capital injection for M&B from a private equity investor.
Still, it's worth remembering that investor Tchenguiz last November responded to reports he may have to make some sales to compensate for substanstial paper losses because of the credit crunch, by saying the R20 vehicle intended to continue holding its shares in J Sainsbury and M&B.
Overall, London markets have extended gains in afternoon trading, with Wall Street's strong open providing support. The FTSE 100 is up more than 84 points, or 1.4%, at 5,991.3 while the Dow is currently 119 points higher, a rise of 1%, at 12,481.
