The Mail on Sunday

Punch in limbo as boss exits

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GILES THORLEY’S surprise exit as chief executive of Punch Taverns is expected to trigger a break-up of the struggling pub company.

Rival chains are understood to be casting an eye over Punch’s managed division – the 800-strong Punch Pub Company, formerly known as Spirit Group, which demerged from Punch in 2002 but was then bought back in 2006.

All Bar One owner Mitchells & Butlers, headed by chief executive Adam Fowle and executive chairman John Lovering, is considerin­g its options.

However, an adviser to M&B said: ‘Buying the managed pubs would fit in with our plans and Giles’s departure certainly opens this up as a possibilit­y.

‘However, there is an issue with the kind of debt attached to the pubs.’ Punch has a £3.5 billion debt pile.

M&B tried to buy the Spirit estate last year, but the deal collapsed over price and the complex unravellin­g of the heavily indebted pubs.

The estate could fetch between £500 million and £750 million, but the price would depend on whether M&B had rival bidders.

Meanwhile, one of Punch’s largest shareholde­rs questioned whether Thorley, who earned £30 million in the past eight years, should be replaced.

Schroders’ fund manager Andy Brough said: ‘Punch has two people running the two divisions, it’s got a financial director and an executive chairman. What would a chief executive do?’

A Punch spokesman said the hunt for Thorley’s replacemen­t was under way.

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