Pres­sure grows to split leisure giant into two di­vi­sions.

Yorkshire Post - Business - - BUSINESS / NEWS -

Shares in Whit­bread rock­eted on Mon­day af­ter ac­tivist in­vestor El­liott re­vealed it has be­come the firm’s largest share­holder, with pres­sure ex­pected to be ap­plied to break up the Costa Cof­fee and Premier Inn owner.

El­liott now owns over 6 per cent of Whit­bread, the firm con­firmed, and it is un­der­stood that it will now push for Costa and Premier Inn to be­come two sep­a­rate listed en­ti­ties.

Costa is thought to be worth be­tween £2bn and £3bn while Premier Inn is val­ued at up to £8bn.

El­liott, which has a rep­u­ta­tion for cor­po­rate ac­tivism, is un­der­stood to con­sider the pair­ing of Costa and Premier Inn under Whit­bread to be an anom­aly with no syn­er­gies.

It is not the first time Whit­bread has been tar­geted by an ac­tivist.

US hedge fund Sachem Head owns a 3.4 per cent stake in the firm and is also thought to be push­ing for a sep­a­ra­tion of the two brands.

An­a­lysts said that the po­si­tions taken by the pair piles fur­ther pres­sure on Whit­bread boss Ali­son Brit­tain, pic­tured.

David Mad­den, mar­ket an­a­lyst at CMC Mar­kets, said: “Whit­bread shares are in de­mand af­ter the ac­tivist in­vestor El­liott Ad­vi­sors stated they now own more than 6 per cent of the com­pany – mak­ing them the largest share­holder. The in­vest­ment com­pany is push­ing for a de­merger of the group, so Costa Cof­fee and Premier Inn would be two sep­a­rate com­pa­nies.”

Ms Brit­tain has pre­vi­ously said she re­mains “en­tirely open-minded about the struc­ture of the busi­ness”.

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