Pubs chief could walk away with pounds 850,000

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The Independent Online
The managing director of the fast-growing pubs group JD Wetherspoon is set to walk away with more than pounds 850,000 after his unexpected resignation yesterday "to pursue other interests".

Brought in only two and half years ago after a banking career at NatWest, Mark McQuater is still negotiating his severance package but it promises to be even bigger than the pounds 640,000 pay-off secured earlier this week by Francis Baron, who pocketed two years' pay after being ousted from First Choice, the holidays group.

Tim Martin, executive chairman of Wetherspoon and the driving force of the successful pub chain he founded, insisted yesterday there had been no falling out between the two. But Mr McQuater will not be replaced and doubts have been raised over Mr Martin's ability to delegate responsibility in a group he still dominates.

Mr McQuater earned pounds 134,400 according to Wetherspoon's latest report and accounts and was employed on a 12-month rolling contract which it is understood the company will pay out in full. He also holds 90,000 options over shares at an average exercise price of about 400p compared to yesterday's close of 1215p.

Exercising those options would net Mr McQuater pounds 720,000, taking his total severance package to over pounds 850,000.

The role of managing director will now be absorbed by the existing executive team. Mr Martin said the company would review the position of managing director again within the next year.

News of the bumper pay-offs from two relatively small companies is certain to irritate investors, although Mr McQuater's package has the merit of being largely a reflection of the dramatic appreciation of Wetherspoon's share price in recent years. Mr Baron's pay-off, which followed a halving of First Choice's share price during his tenure, was viewed as another example of "payment for failure".

JD Wetherspoon has been one of the most successful of the fast-growing managed pub groups spawned by the beer orders of 1989 which attempted to ease the stranglehold of the big brewers on the pubs they supplied. It has flourished by offering completely music-free pubs, serving good cask-conditioned beers and all-day food.

Wetherspoon's shares have risen almost tenfold since coming to the market in 1992, making a fortune for Mr Martin, who holds shares worth more than pounds 80m at the current price.