Norman ruled out M&B post before alleged blocking move

Published on Sunday 29 November 2009 20:41

ARCHIE Norman had privately ruled out taking over in the near-term as chairman of pubs giant Mitchells & Butlers even before billionaire currency trader Joe Lewis is believed to have blocked his appointment.

It is understood Norman decided he had too big a task at struggling broadcaster ITV, where he was appointed chairman this month, to consider another chairmanship at this stage.

This was despite ITV telling Norman, a former Asda boss and Tory MP, that it had no objections to him taking on another non-executive chairman role.

Sources told The Scotsman they believed Bahamas-based Lewis's action at M&B – the billionaire has a near-23 per cent stake and two seats on the board of the pubs group – had less to do with Norman himself than a possible assertion of boardroom influence.

One person familiar with the situation said: "You suspect this is part of a power play by Lewis, to show he can exert control over the board, rather than anything to do with Norman.

"The two don't know each other, have never met. This is a way for Joe to stress he is the major shareholder and calls the shots at the group."

Some City analysts have voiced concern that Lewis, who also owns Tottenham Hotspur football club, is gaining de facto control over M&B without making a takeover bid.

Lewis voted against the company's remuneration scheme and a proposal to issue new shares at last January's AGM.

Other big investors in M&B include John Magnier and JP McManus, the Irish horse-racing magnates who between them own 17.5 per cent of the shares.

They are friends of Lewis, but there is no suggestion they are working together in relation to M&B, whose pub chains include O'Neill's, All Bar One and Toby Carvery.

It is understood that Norman – who is credited with turning around Asda in the 1990s before selling the supermarket giant to US retail giant Wal-Mart – was approached by the M&B board about the chairmanship about a month ago, before the ITV appointment was made public.

Although talks took place no job offer is thought to have been made or accepted. Norman is believed to have told M&B at that time that another corporate commitment (meaning ITV) might prove a complication in the immediate future.

It is believed it was at this time that Norman decided there was too much to do at ITV, which has suffered from management upheaval and a slump in advertising revenues, to consider another big public chairmanship role.

M&B has been looking for a new chairman after Drummond Hall decided to step down after only 18 months in the job.

Lewis, who is thought to have lost $1 billion (600 million) from the collapse in 2008 of American investment bank Bear Stearns, bought his M&B stake from property tycoon Robert Tchenguiz.

Tchenguiz was forced to sell some of his big public company holdings following last year's banking meltdown. M&B, Lewis and Norman were all unavailable for comment yesterday.

Last week M&B posted a 24 per cent fall in profits to 134m, although like-for-like sales improved 3.2 per cent in the first eight weeks of its new financial year.