The battle of Kent

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Mark Stretton analyses the family feud at Shepherd Neame that brought about the recent departure of vice-chairman Stuart Neame.Most brewing families...

Mark Stretton analyses the family feud at Shepherd Neame that brought about the recent departure of vice-chairman Stuart Neame.

Most brewing families seem more like the Waltons than the Ewings but last week the feud of Faversham was like a storyline out of Dallas.

The events at Shepherd Neame had everything: a power struggle played out in public, claims, counter-claims, allegations, the resignation of a family director and the odd proverbial bullet in the back.

Ultimately only one thing is clear - Stuart Neame, the outspoken and vociferous vice-chairman, has left the building.

He quit the Kent brewer after differences with Uncle Bobby and cousin Jonathan over current strategy and who should be the next leader of the company.

The spin-doctors close to Shepherd Neame say Stuart wanted to replace Bobby as chairman of the company but whether that is true is uncertain.

The story differs from source to source but battle lines were apparently drawn up three months ago when Stuart, unhappy with performance, told company chairman Bobby it was time to go. "I told him I thought it would be in the company's interests if he stepped down," Stuart reportedly said. "He does not have a birthright to run the brewery."

Bobby is almost 70 and, according to a company spokesman, not in "any rush to retire, but then not intent on staying". With Stuart apparently waiting in the wings to assume the top spot, and given his frank appraisal of Uncle Bobby, the board of directors decided to consult staff and shareholders.

According to sources close to several directors, the board concluded that Stuart Neame would not be the next chairman of the company and that was the reason he resigned.

However, on reading this particular theory in the national press, Stuart fired off a letter to the Shepherd Neame company secretary and the press saying this was untrue - and libellous.

Stuart also apologised for not contacting anyone sooner - all his numbers and addresses were stored on a mobile and a laptop, which were both confiscated by Shepherd Neame.

What he'll do now is not clear. Maybe we will see another brewery crop up in Kent á la Samuel Smith and John Smith of Tadcaster. Maybe not.

It seems the real difference of opinion was over strategy.

Bobby, Stuart and Jonathan had distinct roles at Shepherd Neame. Taking the war theme that the company uses so enthusiastically to promote Spitfire, Bobby was king, ruler of all he surveyed, Jonathan was field marshall Montgomery, leading the troops into battle and overseeing strategy, while Stuart was a mix of prime minister and spin doctor - a seasoned campaigner, very public, never one to shy away from a political fight.

As Neame vice-chairman, he was best known for his forthright views on the excessive levels of duty levied on alcohol (a few years ago he tried to take the Treasury to the European courts over taxes on alcohol) and his desire to kill the licensing bill.

What is certain is he had strong views on where the Kent brewer was going wrong, and it was this that probably set the loudest alarm bells ringing in the ears of the board.

He may have just been illustrating a point but he apparently wanted Shepherd Neame to become a property company. He said: "If we rented out all our properties and did nothing more than run things from an office with one man and a dog, we'd make more money."

Stuart also lamented the amount of cash thrown at Spitfire. But the two points he made on company strategy were flawed. Suggesting it should rent out all the property it owned to make much more profit is a bit like saying Tesco should lease out all the sites it owns to other retailers.

And, as many brewers have learned, if you are not prepared to invest in beer brands you can sit back and watch them decline. "We have been widely quoted as spending £500,000 on Spitfire," Jonathan told The Publican. "It's very easy to say that if we hadn't spent that then profits would be £500,000 higher but that is grossly misleading and frankly shows a lack of understanding of this business."

Spitfire is growing quickly - last year volumes grew by 24.9 per cent - but presumably at some cost to margins. One solution to the high costs might be to quit brewing. Who could blame a business that focuses on the greater returns of operating managed pubs?

But to do this would be to go the way of Brakspear, Eldridge Pope, Morrells of Oxford and a whole raft of other "soulless" pub companies whose management turned their backs on heritage. Many have argued that, romanticism aside, regional brewers which stop brewing rip the heart from a business. History is littered with evidence to back that up.

It is also worth noting that Stuart has been a board member for some time and was a key person in deciding the company's strategy, and that the company has grown profits for the past 24 years.

The best suggestion attributed to Stuart during this feud was that non-executive director Miles Templeman should be made chairman. People of Mr Templeman's stature do not come along very often. He is reputed to be a brilliant manager, has a strong track record and, importantly, he is already a non-executive.

If any sector is vulnerable to feuding families it is the British beer industry. It is also becoming something of a habit for the Neames - Bobby wrestled the chairmanship from Colin Neame some 20-odd years ago.

Brewing probably has more companies with members of the founding family still at the helm than any other UK industry. Adnams, Batemans, Charles Wells, Everards, Fuller's, Greene King, JW Lees, McMullen, St Austell, Youngs. Families still rule them all.

The image of British brewing seems to take a bit of a bashing when these squabbles happen it engenders, wrongly in most cases, the view that UK regional brewers are still from the Old School and you get a job based not on merit but on surname.

War of words