A unit of US activist hedge fund Elliott Management how holds a six-percent stake in Whitbread (LON:WTB), Reuters has reported. The disclosure came about three months after it emerged that activist investor, Sachem Head, wanted the FTSE 100 group’s management to examine a break-up as a way to boost the value of its individual businesses.
Whitbread’s share price rose on Friday, adding 3.31 percent to close at 3,935.00p, outperforming the broader UK market, with the benchmark FTSE 100 index ending the session 0.09 percent higher at 7,264.56. The group’s shares have lost nearly six percent of their value over the past year, as compared with about a one-percent dip in the Footsie.
Elliott builds up stake in Whitbread
Reuters reported over the weekend that Elliott Advisors how held over six percent in Whitbread, with the move turning the hedge fund into the blue-chip company’s biggest shareholder. The newswire noted that the Costa Coffee and Premier Inn owner had declined to comment on Elliott’s disclosure.
The Times meanwhile reports that according to City sources, Elliott is pushing for Whitbread to spin off Costa through a float in an effort to create as much as £3 billion of additional value. Having bought into the company nearly a year ago, the hedge fund’s stake was reported by The Sunday Times to be worth about £430 million now.
Analysts on Costa Coffee owner
The 23 analysts offering 12-month price targets for Whitbread for the Financial Times have a median target of 4,150.00p on the shares, with a high estimate of 4,950.00p and a low estimate of 3,100.00p. As of April 13, the consensus forecast amongst 27 polled investment analysts covering the Costa Coffee and Premier Inn owner advises investors to hold their position in the company.