Bass keeps its options open

Bass is keeping an open mind about what to do with the £2b it is likely to get if, as widely expected, it sells off its brewing arm in the next few weeks.

Chairman Sir Ian Prosser confirmed earlier today that a sale of Bass's brewing interests was the "more likely outcome" of the strategic review announced by the company in February. It is in confidential talks about selling the business, Prosser said.

Market rumours are rife that Bass will invest the proceeds in buying a major international hotel group, possibly Starwood Hotels & Resorts. Bass would not comment on stock market rumours that a deal with Starwood was imminent. Starwood said it was "definitely not".

A Bass spokesman said the company had "a fairly open view" on how to best use the proceeds from a brewing sell-off to make money for its shareholders. This did not necessarily mean a major acquisition. "We will still look at cherry-picking individual hotel sites and small hotel chains," he said.

When Bass sold off its leisure businesses, including Gala Bingo and Coral Racing, two years ago, it had looked at all options, the spokesman added. Eventually, £800m was returned to shareholders and £1.78b spent on buying the Inter-Continental hotel chain.

Bass today announced pre-tax profits up by 25% at £324m for the 28 weeks ended 15 April. Turnover rose by 11.2% to £2.5b.

by David Shrimpton david.shrimpton@rbi.co.uk