M&B appeals to shareholders ahead of AGM board vote

Mitchells & Butlers (M&B) has appealed to shareholders to vote for what it called a "strong and balanced" board and ignore attempts by a minority shareholder to influence the company's direction.

With a crucial AGM just weeks away M&B said in a letter to investors it would not accept what it called the "demands" of Piedmont Inc., which represents Joe Lewis, who holds around 23 per cent of the managed pub operator's shares.

Such demands had yet to be made public, but M&B said it had been in "extensive negotiations" with Piedmont for the last nine months and hinted that it had submitted a considerable shopping list of requirements, which included ousting Simon Laffin as chairman.

Inviting Piedmont to publicise its demands, M&B told investors that "accepting Piedmont Inc.'s demands would constitute permitting a single minority shareholder to have proposed or nominated a majority, or at least a substantial proportion, of your board which the current directors believe is wholly inappropriate".

It called on shareholders to resist resolutions to vote onto its board nominees of Piedmont, including Jeremy Blood, the former managing director of Scottish & Newcastle and John Lovering, current chairman of Debenhams and former chairman of Laurel Pub Company.

Under the terms of its investment in M&B Piedmont is legally entitled to submit two representatives to join the group's board, submissions M&B is obliged to accept.

Noting that Piedmont had put forward one such representative, Ron Robson, M&B said it welcomed "constructive shareholder involvement and interest in our business, and so looks forward to him making a positive contribution".

M&B's AGM is to be held on Thursday, January 28, 2010.