SHARES in Whitbread jumped almost 9 per cent yesterday — the biggest riser in the FTSE 100 — amid indications that the leisure group is being circled by private equity firms.

Two rival consortiums, headed by Permira and CVC Capital Partners, are understood to be looking at the potential for a break-up of the company, which has a string of household names including David Lloyd Leisure, Costa and Premier Travel Inn.

The 75p rise in the shares to 925p values Whitbread at £2.4 billion, or almost £3.6 billion including debt. Analysts reckon its assets could be worth at least 950p in a break-up once it has completed its exit from Marriott Hotels, while some argue that the figure could rise as high as £11.50.

Permira and CVC, which fought head-on in the bidding battle for Debenhams two years ago, are said to be sounding out potential partners with a view to making an approach to Whitbread.

Duke Street Capital is thought to be central to both consortiums’ plans. The private equity firm owns the Esporta health and fitness club chain, which is seen as one of the few companies that could be merged with Whitbread’s David Lloyd Leisure.

Duke Street is also thought to have held preliminary discussions with Apax Partners. The two private equity firms have previously invested together in Focus Wickes, the do-it-youself group.

Permira owns the Travelodge budget hotel chain and analysts said it could merge the business with Whitbread’s Premier Travel Inn chain, combining the UK’s two biggest budget operators.

However, City sources cautioned that the putative consortiums were probably weeks or even months away from making a bid and that they may end up walking away without making a move.

The attraction for predators is that Whitbread is a leisure conglomerate that appears to draw relatively little benefit from having three separate businesses. The decision by its new chief executive, Alan Parker, to sell its Marriott hotel arm has removed a potential “poison pill” while its recent disappointing trading update appears to have provided the catalyst for CVC and Permira to investigate possible bids.

Observers suggested that some of its high street restaurant brands, including Costa and TGI Friday’s, might interest The Restaurant Group or Urban Dining, while pub-restaurants chains such as Beefeater and Brewers Fayre might tempt the likes of Mitchells & Butlers. None of the parties involved would comment.

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