Six Continents has admitted a demerger of its pubs and hotels divisions is a strong possibility, an announcement that sent its share price up 41p to 587p on Friday.
The group said on Friday that the SixC board "has been actively considering a demerger" alongside its stated commitment to return capital to shareholders if it fails to make a major hotel acquisition by the year-end.
SixC said that "no final decision has yet been made." However, the stock market reacted happily to the possibility of a demerger that could see up to £750m returned to shareholders. The changes of a big hotel acquisition by SixC by the end of the year is viewed as unlikely, especially with the prospect of a war with Iraq lurking in the background.
Weekend newspaper reports outlined the likely board line-ups of a divided SixC, and suggested the group's current chairman, Sir Ian Prosser, plans to postpone his retirement so that he can oversee the company's demerger.
Roger Carr and Tim Clarke are named as likely heads of t a new quoted pubs and restaurants group. Karim Naffah, the group's strategic director, has been suggested as the likely finance director.
Reports suggested Prosser has agreed to become chairman of the hotel company, which would retain the name Six Continents. Richard North, the curent SixC finance director, would join him as chief executive. It is also thought Richard Solomons will become finance director of the hotel group.
Analysts believe two "investment-ready" companies comprising the hotels division, which included the Intercontinental and Holiday Inn brands, and the pubs and restaurantrs division. would be attractive to potential investors. They think a bid for the pubs arm would quickly follow any demerger. Scottish & Newcastle (S&N) denied on Friday that it was interested in a merger but analysts think an alliance with S&N at some stage is possible.
Earlier rumours suggested that SixC has moved its usual 48-week trading statement on by a fortnight to include the news of the demerger, which could raise up to £2bn for the company.
However, the company said that it had rescheduled the trading update so that the group could give a clearer picture of how its hotels have performed up until the end of September and provide a more meaningful year-on-year comparison following the September 11 attacks.
The group said on Friday that the SixC board "has been actively considering a demerger" alongside its stated commitment to return capital to shareholders if it fails to make a major hotel acquisition by the year-end.
SixC said that "no final decision has yet been made." However, the stock market reacted happily to the possibility of a demerger that could see up to £750m returned to shareholders. The changes of a big hotel acquisition by SixC by the end of the year is viewed as unlikely, especially with the prospect of a war with Iraq lurking in the background.
Weekend newspaper reports outlined the likely board line-ups of a divided SixC, and suggested the group's current chairman, Sir Ian Prosser, plans to postpone his retirement so that he can oversee the company's demerger.
Roger Carr and Tim Clarke are named as likely heads of t a new quoted pubs and restaurants group. Karim Naffah, the group's strategic director, has been suggested as the likely finance director.
Reports suggested Prosser has agreed to become chairman of the hotel company, which would retain the name Six Continents. Richard North, the curent SixC finance director, would join him as chief executive. It is also thought Richard Solomons will become finance director of the hotel group.
Analysts believe two "investment-ready" companies comprising the hotels division, which included the Intercontinental and Holiday Inn brands, and the pubs and restaurantrs division. would be attractive to potential investors. They think a bid for the pubs arm would quickly follow any demerger. Scottish & Newcastle (S&N) denied on Friday that it was interested in a merger but analysts think an alliance with S&N at some stage is possible.
Earlier rumours suggested that SixC has moved its usual 48-week trading statement on by a fortnight to include the news of the demerger, which could raise up to £2bn for the company.
However, the company said that it had rescheduled the trading update so that the group could give a clearer picture of how its hotels have performed up until the end of September and provide a more meaningful year-on-year comparison following the September 11 attacks.
