The Business says a merger of Six Continents’ (6C) new pubs business with Scottish & Newcastle’s (S&N) pub estate is still believed to be the company’s favoured option post demerger.

S&N, however, remains reluctant to return to the

negotiating table.

The Observer says Tim Clarke, who will head the pubs and restaurants sounds desperate to find new partners as soon as the divorce is complete.

It says Clarke is more likely to add outlets than buy an entire company but the newspaper’s Throg Street column says a company desperate for a deal is always a bit of a risk.

Potential merger partners with Six Continents hotel operation could try to force the issue of a tie-up ahead of next year’s demerger.

Deutsche Bank says the demerger will give markets the chance to value each of 6Cs’ businesses for the first time, eliminating the discount which has been applied to 6C as a conglomerate.

The Business says the market over-reacted to the demerger announcement. The shares sank 70p to 510p on concerns about a dividend cut and a possible downward re-rating of the demerged company’s credit.

The Business 06/10/02 page 2 (Best Of The Rest), page 16, page 28 (Trading Options)

Financial Mail On Sunday 06/10/02 page 1

The Observer 06/10/02 page 6 (Business – Throg Street)