The move, part of an increasingly desperate defence against an unwanted pounds 3.2bn bid from Granada, the television and leisure company, led City analysts to admit that the takeover battle was now too close to call.
If the restaurant deal goes through, Whitbread, already the owners of Pizza Hut, TGI Friday's and Beefeater, will become the UK's largest restaurant operator - bigger than market leader McDonald's - with Forte's 430 Little Chef and Happy Eater outlets.
The agreement is the latest salvo in the highly hostile and personal battle between Forte and Granada, the maker of the long-running television soap opera Coronation Street, which is run by the cheerful but ruthless Gerry Robinson, one of the City's most respected managers.
Granada's pounds 3.2bn bid has galvanised management at Forte, which has sold off companies worth pounds 160m since the offer was launched, in a desperate attempt to ward off Granada's unwanted attentions.
The deal with Whitbread, which is conditional on the Granada bid's lapsing, has raised the stakes to fever pitch.
Whitbread's late entry into the saga means that three of the UK's most influential companies, which between them own pubs, luxury hotels, restaurants, two ITV television companies and two huge retail chains, are now battling centre-stage in what has become one of the most bitter struggles in recent memory.
Granada, predictably, criticised the proposed sale yesterday. Mr Robinson, Granada's Irish-born chief executive, said from Donegal: "This is certainly a brilliant deal from Whitbread's point of view, but it isn't in the best interests of [Forte] shareholders." He claimed that Granada's management could double the profits of Forte's restaurant business within two years.
Word of Forte's secret negotiations with Whitbread emerged over the Christmas holiday weekend, as Mr Robinson was spending time at his family home in Ireland. Forte chairman Sir Rocco Forte, who was forced to rush back to London from a shoot in Yorkshire last month when Granada unveiled its initial offer relished turning the tables on his absent adversary yesterday.
"I suspect that Mr Robinson didn't have time to finish his Christmas pudding," he said.
Mr Robinson responded: "I had plenty of time to finish," and added that the deal did not worry him. "Shareholders must now make a choice as to whether they prefer this offer or our more generous offer for the whole of Forte."
If Sir Rocco, the heir to the Forte family's hotels and catering business, manages to pull off the Whitbread deal, he will be left with a company only two-thirds its original size but with most of its hotels business intact and with debt virtually wiped out. Sir Rocco said yesterday: "The whole point of our strategy is to get down to being a focused hotel group." Forte owns the luxury Grosvenor House in London, as well as five-star properties in Europe.
Granada accuses Forte of engaging in a firesale dumping of assets, and says the management only began to act effectively following the unveiling of Granada's hostile bid last month.
Sir Rocco disputes this, claiming that the group had already embarked on a restructuring, and that Granada was attempting to get Forte on the cheap, just before the hotel cycle swings upward again.
The dramatic battle is expected to continue into next week, as Granada considers whether to raise its offer and Forte continues to seek buyers for non-core businesses. Forte is also expected to promise a special dividend for shareholders if they agree to dismiss the Granada bid and stick with current management.
Unless it decides to throw in the towel - unlikely, say insiders - Granada will now have to come back with a sweetener, which analysts expect will have to top pounds 600m, to take the offer to about pounds 3.8bn.
Pressure on Granada, page 16
Comment, page 17
The Whitbread empire
Whitbread's outlets if the Forte deal goes ahead:
Public houses: 2,600
Thresher off-licences: 1,603
Pizza Hut: 239 (plus 100 takeaways)
Beefeater pubs: 270
TGI Friday restaurants: 18
Brewer's Fayre pub restaurants: 230 (plus 50 opening this financial year)
Costa Coffee cafes: 41
Little Chef and Happy Eater restaurants: 430
Travelodge budget hotels: 127
Welcome Break motorway services: 26
Cote France motorway services: 55