Four bids are believed to be on the table in the �1.4bn battle to land Whitbread's 3,000 pubs.

But the sale may be held up because of disagreements over contracts.

The two most high-profile contenders are Japanese investment bank Nomura, which is already Britain's biggest pub landlord, and leisure entrepreneur Hugh Osmond's privately-owned Punch group.

Pubmaster, part-owned by investment bank West LB, and Morgan Grenfell Private Equity are also thought to be in the running.

Focusing on leisure

The sale is part of Whitbread's long-term strategy to re-invent itself as a leisure company, focusing on hotels, restaurants and health clubs.

It owns the Marriott and Travel Inn hotels, Brewers Fayre and Beefeater restaurants, David Lloyd Leisure and operates Pizza Hut in the UK.

Last year Whitbread sold its brewing interests to Belgium's Interbrew in a �400m deal.

However, the pub sale could be held up because several bidders are understood to be concerned about the details of the contract.

"It's unlikely the offers will be as unconditional as Whitbread would like," said a source close to the auction.

All bids are believed to be over �1.4bn.

Wolverhampton battle

Nomura, which won the battle for Bass's pub estate earlier this year, is also in the running for Britain's largest regional brewer Wolverhampton and Dudley.

The Japanese bank owns 5,585 pubs across the UK.

It is thought to be interested in W & D's tenanted pubs and some of its managed houses, which include the Pitcher and Piano chain.

Nomura is thought likely to sell or close down W & D 's four breweries, which produces well-known brews such as Marston's, Pedigree and Banks's, if it wins the �470m battle to buy the Midlands-based brewer.

According to the Sunday Telegraph newspaper other contenders for W & D are Pubmaster, leisure entrepreneur Robert Breare and a management buyout led by managing director David Thompson.

Britain's brewing industry is going through an unprecedented period of consolidation in the face of a declining market for cask ales.