Lovering's M&B idea provides food for thought

JOHN Lovering, the newly-installed chairman of Mitchells & Butlers, has unveiled plans to rapidly turn the multi-billion-pound group into a food-led business with less reliance upon operations dominated by the "price-sensitive" drinks market.

Following a 55-day review in the wake of a contentious boardroom coup, Lovering said M&B would increase the pace of expansion across its mid-market eatery brands. These include Harvester, Toby Carvery, Crown Carveries, the Sizzling Pub chain, Premium Country Dining and Vintage Inns, which the group believes have the scope to more than double in size to 1,900 UK outlets.

On the other hand, M&B said it would "take early action to exit from our non-core activities", which will include drinks-led brands such as the All Bar One chain. The group will examine a variety of options for these outlets, including conversion of individual sites into one of the "growth brands".

"We will seek out disposal opportunities to fund or swap in assets better aligned with the growth brands, and we will otherwise adopt a focused but careful approach to disposals so as to maximise achievable value," M&B said.

Lovering and three other non-executive directors were elected to the board in late January with the backing of key shareholder Piedmont, an investment vehicle controlled by Bahamas-based currency trader Joe Lewis. M&B is now reportedly considering 100 per cent pay rises for its non-executives, which would boost Lovering's salary to about 400,000.

The group said yesterday that it had appointed new pay advisers, but remuneration was still under discussion. However, it will "move the basis of pay and culture towards one which encourages greater growth in shareholder value".