The power struggle at Mitchells & Butlers (M&B) ratcheted up a notch yesterday when the dissident shareholder Joe Lewis demanded the appointment of four new directors and the immediate removal of the pub group's outgoing chairman.
The Bahamas-based billionaire's Piedmont investment vehicle, which owns 23 per cent of the company, is calling for John Lovering, Jeremy Blood, Michael Balfour and Simon Burke to take up positions on the 2,000-strong pub chain's board. And Drummond Hall, recently replaced as chairman by Simon Laffin, must step down from the board altogether.
Richard McGuire, from Piedmont, said: "M&B must resolve the current boardroom impasse. These candidates, with proven track records, would provide the necessary expertise, counsel and strategic leadership to ensure M&B delivers long-term value to all shareholders."
The move is the latest twist in a boardroom brawl that erupted at the end of last month when M&B asked the Takeover Panel to investigate the influence Mr Lewis was exerting over the group. The request claimed Piedmont's representatives were acting in concert with those of Elpida, the investment vehicle of the Irish horse-racing tycoons JP McManus and John Magnier, which is the second-largest shareholder in M&B. The company's management maintained that the rebel shareholders were seeking to gain control of the board and "advance the interests of a small group of shareholders at the expense of others".
Within days of the approach to the Takeover Panel, a dispute about the value of M&B's property portfolio resulted in the ousting of four of the company's 15 directors. The four included Mr McGuire and Douglas McMahon, who also represents Mr Lewis, as well as Ray MacSharry and Denis Jackson, who reportedly speak for Mr McManus and Mr Magnier.
The first rumblings of discontent from Mr Lewis came within months of Piedmont's involvement in M&B. Mr Lewis bought his stake in autumn 2008 from the credit crunch-struck property magnate Robert Tchenguiz. By the January he was voting against M&B's remuneration policy and opposing plans to raise funds without giving existing shareholders pre-emption rights.
Piedmont vigorously denies it is acting in concert with other shareholders and maintains that its only aim is to improve transparency.
Shareholders will vote on the proposed new directors at the AGM in January. The four are all big-hitters in the industry. Mr Burke is the chairman of Majestic, the wine company; Mr Lovering is the outgoing chairman of Debenhams; Mr Balfour set up the Fitness First chain; and Mr Blood recently stepped down after more than 20 years at Scottish & Newcastle.Reuse content