Whitbread (LON:WTB) is again facing pressure from activist investor Elliott Advisors, The Telegraph has reported. The news marks a blow for the Premier Inn owner which recently revealed a slump in its annual profits following the sale of its Costa Coffee business, and warned of ‘acute’ political and economic uncertainty in the UK.
Whitbread’s share price has climbed higher in London this morning, having gained 0.97 percent to 4,598.00p as of 08:11 BST. The stock is outperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.27 percent lower at 7,360.49 points. The group’s shares have added more than seven percent to their value over the past year, as compared with about a two-percent drop in the Footsie.
Whitbread faces investor pressure
The Telegraph reported over the weekend that Elliott Advisors was poised to renew its attack on Whitbread, putting it on a collision course with boss Alison Brittain for the second time in little over a year. The activist investor is said to be becoming increasingly frustrated by the FTS 100 group’s strategy of owning Premier Inn hotels outright, claiming that such a move is depressing Whitbread’s share price and leaving it open to a cut-price hostile takeover.
Sources told the newspaper that the Paul Singer-founded fund, one of the blue-chip company’s biggest investors, wants it to offload chunks of its £5.8-billion property portfolio. The update comes after news emerged last year that Elliott, which pushed Whitbread to spin off Costa Coffee, had signalled no end to its campaign as it prepares to seek even higher returns from Premier Inn.
Analysts on Premier Inn owner
The 19 analysts offering 12-month targets for the Whitbread share price have a median target of 4,900.00p on the shares, with a high estimate of 5,750.00p and a low estimate of 2,000.00p. As of May 3, the consensus forecast amongst 24 polled investment analysts covering the blue-chip group advises investors to hold their position in the company.