At least nine bidders are expected to submit offers for Scottish & Newcastle’s pub estate today.

Scottish & Newcastle’s (S&N) auction of its £2.3bn pub and hotel estate portfolio includes 1,450 pubs and 140 lodge hotels and includes the Rat & Parrot and Chef & Brewer brands.

The Laurel Pub Company has gained the financial backing of the Nomura International bank for the auction and Mitchells & Butlers (M&B) – formerly the retail arm of Six Continents – is expected to launch a joint bid with Whitbread.

If M&B wins the auction, it will become the biggest managed pub operator in Britain. However, it could be in trouble with its shareholders, as it has reneged on a deal to give £400m spare cash back to investors in order to take part in the S&N auction.

Other bidders are thought to include Pubmaster; CVC and Cinven; Terra Firma; Hugh Osmond, through his Sun Capital bid vehicle, and Luke Johnson

First-round bids for the business, which will go up for sale on 23 July, had to be submitted by yesterday (22 July) and S&N is expected to reduce the list to about four bidders for the second round.

The auction will be conducted for S&N by UBS and Deutsche Bank, which will also be offering a staple £1.85bn financing package to the winner, of which £1.65bn will be investment-grade. Details: www.scottish-newcastle.com