Compromise sought between M&B and Piedmont

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The Independent Online

The Association of British Insurers is seeking to broker a compromise deal between Mitchells & Butlers and Piedmont, its largest shareholder, in the ongoing row between the two sides over the composition of the pubs group’s board. The ABI published a letter it has sent to Simon Laffin, the M&B chairman, urging him to accept some of the new directors nominated by Piedmont, and possibly to stand down as chairman.

The ABI’s intervention follows a week which has seen M&B trade insults with Piedmont, the investment vehicle of the billionaire Joe Lewis. The insurers’ group, which represents large institutional investors, appears to be backing M&B, in that its suggested compromise is very similar to an offer made by the company on Monday.

In that move, seen as an attempt at conciliation, M&B offered to accept two of the four nominations to the board made by Piedmont, but said backing all four would see the shareholder dominating the board. Piedmont subsequently rejected that offer.

The ABI revealed that Peter Montagnon, its director of investment affairs, has told Mr Laffin that many M&B investors want a compromise. Mr Montagnon’s letter said “a majority of directors must not be Piedmont nominees or representatives”, but also called for all directors to stand for re-election next year, once investors had been given a chance to evaluate their performance.