Mitchells & Butlers said it was studying a Reit proposal from R20, the investment vehicle owned by Robert Tchenguiz, which controls about 19 per cent of M&B and made an unsuccessful takeover bid last year. Financial Times, Daily Telegraph

M&B has been resisting the REIT solution to unlocking the value of its property portfolio, now valued at £5bn, preferring a joint venture with R20 – only to see that idea scuppered by credit market turbulence. But Tchenguiz is willing to underwrite about 25% of a REIT, giving shareholders the option of cashing in their share in a property company.

M&B, which owns 2,000 pubs, said it was giving the proposal 'serious consideration' but tax costs of £100m as well as fees running into 'tens of millions' of pounds and the implications for pensions had to be weighed up.

The pub group went from a £220m profit to a £48m pretax loss in the year to the end of September, after efforts to set up a property joint venture Tchenguiz backfired, resulting in M&B taking a £155m post-tax hit on hedges set up in connection with the postponed proposal.