All Bar One owner Mitchells & Butlers (M&B) conceded defeat today after a bitter battle with rebel shareholders claimed the scalp of its chairman.
Pub group M&B will now undergo a complete board overhaul after Joe Lewis - the billionaire who owns 22.8 per cent of the firm through his Piedmont investment vehicle - succeeded in ousting most of the firm's existing leadership.
Chairman Simon Laffin is one of three board members to have been removed after hostile investors voted against him at a tense shareholder meeting in Birmingham today.
A statement from the outgoing directors said the board had taken a "principled stance" in opposing Piedmont.
They added: "We would like to thank all of the many thousands of shareholders, large and small, who have supported the Board's position.
"We wish the new board well and trust that it will be allowed to continue the work already in hand to strengthen further this great business."
Voting figures showed 66 per cent of votes cast were made against Mr Laffin's re-election.
The results came despite support from institutional shareholders such as Standard Life, which owns a 4.8 per cent stake in the company and spoke out to back M&B's board.
A representative told the meeting the investor was "dismayed by the approach taken by Piedmont".
"Whilst we respect its rights as a shareholder, we are far from convinced that a total overhaul of the board would be in the best interests of the company," he said.
He said the firm did have "room for improvement", but stressed the view that no individual or group of investors should be in a position to dominate or control the board's decision-making.
M&B's ousted board members were also concerned that Mr Lewis's intentions were not in the interests of all investors.
However, the new board said it would stand for election at the next annual general meeting and would "stand down if we do not command support from a majority of shareholders, excluding Piedmont".
New chairman John Lovering said: "The board will put recent history behind us and move forward committed to the interests of all shareholders.
"We will conduct a thorough review of the business which will be presented to all shareholders by the end of March."
Piedmont and Elpida had been furious about £500 million in losses suffered by M&B after a disastrous wrong-way bet on interest rates when a property deal was abandoned due to the credit crunch in 2007.
Mr Laffin, who joined the board last January, expressed regret over the deal and told today's meeting the board was now "substantially different".
But the Elpida representative said: "Most of the non-executive directors sitting on the podium today were on the board throughout this episode and are still being paid by the company."
He said the losses amounted to more than £1 for every share in the company and questioned whether "adequate steps" had been taken to recoup costs from those involved.
Elpida also dismissed suggestions it was working with Mr Lewis as "utter rubbish".
The representative said allegations of a "conspiracy" against the company originated because some directors were "afraid of losing their jobs".
The latest tussle began with the appointment of Mr Laffin as chairman last year, against the will of Piedmont.
M&B also removed four directors because it believed they were not independent and acting in the interests of all shareholders.
Piedmont has now succeeded in installing four new directors - Debenhams chairman Mr Lovering, Fitness First founder Michael Balfour, Jeremy Blood, who was managing director at pub company Scottish & Newcastle, and Simon Burke, who has senior experience with retailers including Hamleys.
It also won the vote to remove former chairman and independent director Drummond Hall.
M&B, which has 2,000 pubs, supported the appointment of Mr Lovering and Mr Burke, but had advised shareholders to vote against the other nominees.
The Association of British Insurers (ABI) - whose members are institutional investors and control around 15% of the UK stock market - said members were "extremely uncomfortable" with the events at M&B.
Peter Montagnon, ABI director of investment affairs, said: "Our members accept the result, but they remain extremely uncomfortable with the process which has enabled a minority shareholder to determine the composition of the board without paying a premium for control.
"There are important issues of principle here which we will analyse carefully and may take up with the relevant authorities."