Six Continents stock leaped 58p to 613p in morning trade on Wednesday, before close 6% higher at 590p.

The rise followed news that restaurant entrepreneur Hugh Osmond, who also founded the Punch Taverns pub group, was to make a bid for the whole of Six Continents.

The firm had been planning to split in April into two separately listed firms.

Six Continents owns a raft of pub and restaurant chains - including All Bar One, O'Neills and Harvester - as well as a vast hotel portfolio whose brands include Holiday Inn, Intercontinental and Crowne Plaza.

The firm said it had not yet received an approach from Capital Management but would consider any proposal on merit.

Red herring?

Mr Osmond has built up a small stake in Six Continents through the investment vehicle Capital Management and Investment.

The company confirmed to the stock exchange that a bid was being considered. But it added:

"No assurance can be given that any offer will be made."

Capital Management's stake was revealed late last week, but is only worth �14m.

Estimates for the value of the Six Continents business as a whole vary from �4.8bn ($7.6bn) to �8bn ($12.7bn).

The surge in share price on Wednesday brought the group's market value to �5.3bn.

Serial entrepreneur

Rumours of a possible bid for Six Continents have been circulating for months.

The group, which was created from Bass after it sold it sold its brewing business, had come under pressure to demerge and return cash to shareholders.

The firm finally agreed in October, saying it would split into two companies, separately listed on the London stock market, and return �700m to shareholders.

The All Bar One chain has been a success

The hotels business is to be renamed Intercontinental while the pubs business will be called Mitchells & Butlers.

The Financial Times newspaper suggested Mr Osmond has already approached a number of firms with a view to breaking up the group.

He built his reputation as an entrepreneur by helping create PizzaExpress along with Luke Johnson, then buying Allied Domecq's pub business.

That company became Punch Taverns, which was listed on the stock market last year.