Shares in a number of pub operators rose yesterday, after analysts predicted the effects of the introduction of real estate investment trusts (Reits), when they come into force next year. Nigel Parson, of Evolution Securities, said that the introduction of Reits could see pub operators breaking up or being bought because they have “huge valuation upside”, offering larger property portfolios and stable, uncomplicated, cash-generative businesses. Parson said: “Private equity completely understands the opportunity. When the next round of bids arrives, pub companies will surrender or have to convert to a Reit as part of their defence.” Wolverhampton & Dudley Breweries shares rose 50p to 1790p, while shares in Greene King increased by 39p to 1111.5p, after Investec said they were the most likely takeover targets through this process. It suggested that a defensive merger would be a more positive move, bringing with it the potential to cut up to £100m of costs. Investec also raised Punch Taverns to a “buy” rating on rumours that it was considering a bid for Wolves, which pushed the shares up 12.5p to 1202.5p.