Whitbread shares jump as USA hedge fund becomes the largest shareholder

Whitbread share price Elliot builds up stake in company

Whitbread share price Elliot builds up stake in company

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 disclosure came almost three months after Reuters reported that another activist investor, Sachem Head, wanted Whitbread's management to examine a breakup as a way to boost the value of its individual businesses.

Investors and analysts have long raised the idea that Whitbread should spin off its popular Costa coffee-shop chain.

The Sachem Head hedge fund holds a 3.38 percent stake in Whitbread, according to Thomson Reuters Eikon data.

This came after it emerged that activist investor Elliott Advisers had built up a £430m position in Whitbread, making it the largest shareholder.

USA hedge fund Sachem Head has a 3.4% stake in Whitbread and has pressed the management to consider a break up of the business as well as a sale and leaseback of its Premier Inn hotel properties.

A spokeswoman for Whitbread declined to comment.

Unlike Sachem Head, however, Elliott does not want Premier Inn to sell its properties.

Elliott Advisors buys shares in companies to agitate for change and, it claims, create value for shareholders.

City analysts have also been piling the pressure on Whitbread to take a decision on Costa in recent months.

"It's always been a point of questioning as to 'what's the logic of having these two businesses together?"