Sir John Banham: "opportunity for aggressive management"

However, they remain sunk well below their year high of 649-1/2p.

The year's low was 412p.

Full advantage

In its statement, the company said it was forming a unit called "Future Whitbread" which would concentrate on its Marriott and Travel Inn hotels, its Brewers Fayre and Beefeater restaurants and its David Lloyd Leisure leisure business.

Chairman Sir John Banham said: "The restructuring creates the opportunity and the momentum to manage Whitbread's brands and property assets more aggressively and to take full advantage of Whitbread's leading positions in growth segments of the UK leisure market."

The restaurants business

Brewers Fayre Beefeater Bella Pasta Cafe Rouge Costa Coffee Germany's Maredo Pizza Hut TGI Friday's

The company said it had received approaches from firms interested in buying its pubs and bar operations and was considering selling the unit, either as a whole or in parts.

Chief executive David Thomas said the list of potential buyers was "well into double figures" and included private equity firms as well as trade buyers.

MBO "not on the cards"

The pubs business management was "very highly motivated" but a management buy-out was "not on the cards", he said.

About 75% of the net proceeds of any sale would be returned to shareholders, Whitbread said.

The pubs business

1,710 leased pubs 1,095 managed pubs 193 branded pubs including Hogsheads and French-style Dome cafe bars

"The return of value to shareholders is expected to be substantially complete by mid-2001", Whitbread said.

Until then, Whitbread may also seek to benefit its shareholders by buying back shares.

Mr Thomas declined to specify what price Whitbread would seek for its pubs business.

"We aim to get the best price for what is a great business," he said.

The rest of the business

310 hotels under the Marriott, Swallow and Travel Inn brands 44 David Lloyd Leisure clubs

"It has some tremendous brands. For example, Hogsheads is the envy of many of our competitors. It is a very desirable package."

Analysts estimated the pubs' value at about �1.4bn-1.6bn.

Whitbread is due to publish results for the six months to 2 September on 31 October.

Profit before one-off items and tax is expected to be not less than �181m, the company said.

The pubs and bars division generated earnings before interest, tax, depreciation and amortisation of about �104m on sales up 3.3% at �341m.