Whitbread has dropped out of the race for Esporta, opting instead to return£350m from disposals to shareholders.
The hotels and leisure group was viewed as a leading contender for the health club operator since it owns David Lloyd Leisure, a rival in the sector.
The target price for Esporta believed to be about £450m is considered very ambitious as it includes debt of £240m.
Whitbread has confirmed that it has entered formal discussions about the sale of its TGI Fridays chain.
In July the group sold 239 pub restaurant sites to Mitchells and Butlers for £497m.
More recently it disposed of its share in Pizza Hut for £112m. It intends to accelerate its expansion of the Costa Coffee brand, which opens its 500th outlet next month in the UK.
References: Financial Times 25/10/06 page 18 (Lombard), page 20, page 40 (FT Markets), The Times 25/10/06 page 44, page 46 (Need to Know), The Daily Telegraph 25/10/06 page B2, page B3, page B6 (Database), pageB7
