Coles is working on ways to sell its portfolio of pubs while maintaining ownership of its lucrative bottle shop network - a key obstacle to cleansing its business of poker machines.

Australia’s two largest supermarkets have presented Queensland’s archaic liquor licensing laws - which say a business must own licensed venues in order to operate retail liquor stores - as a reason for owning poker machines, which they says subsidise otherwise unviable pubs.

Coles is looking to get out of its pokies portfolio. Credit:Jemma Wallace

Wesfarmers, the conglomerate that owns Coles, has said it is a "reluctant owner" of poker machines because of the social harm they cause, and is looking to sell its pubs and poker machine business ahead of Coles being spun-off as an independent company.

The company is reportedly working on a deal to sell the 90 or so pubs housed within Coles' Spirit Liquor to pub group The Australian Venue Company, which is 80 per cent owned by private equity giant KKR.