PUB company Punch Taverns is being circled by a clutch of hedge funds as it mulls a range of capital restructuring options to stop it drowning in debt.
The firm, which has announced plans to dispose of its non-core pub assets to streamline the business from 5,000 pubs to 3,000 pubs, is currently wrapping up a review led by Goldman Sachs and Blackstone to help it deal with its £2.3bn of debts.
Now a number of hedge funds and private equity investors have decided to increase their stakes in the firm in anticipation of a capital restructure of the business.
Four funds - Avenue Capital, Alchemy, Luxor Capital Group and Octavian Advisors - are all understood to have increased their holdings.
Punch's biggest shareholder is Glenview Capital Management, which owns around 20 per cent of the business.
The restructure is understood to have been complicated by the firm's debt being split into two securitisation structures, adding to the complexity of a deal.
Punch demerged its better performing managed pubs division Spirit Pub last year to cut billions of pounds of debt.