Mitchells & Butlers (M&B), the pub chain, is reportedly being circled by private equity groups Blackstone and CVC Capital Partners.

According to the Guardian, M&B, which has already received an approach from Punch Taverns, has run up losses of around £422m after a property deal with Robert Tchenguiz fell through.

Punch Taverns has already confirmed its intentions to merge with its rival in an all-share merger, but the offer being planned by Blackstone and CVC would likely buy M&B with a new company, and offer shareholders the chance to own about 50 per cent of the business.