M&B's John Lovering to step down as chairman

Mitchells & Butlers (M&B) has announced that John Lovering is to step down from his role as chairman and director of the managed pub group by the end of this year.

According to M&B, Lovering informed the group's board of his plans and the search for a replacement has already begun under the leadership of Simon Burke, a non-executive director of the company.

Lovering was appointed M&B chairman barely 12 months ago following a bitter battle between the then-senior management and a number of shareholder groups who wanted a new direction for the business.

He added weight to M&B's shift towards food-led pub operations, arguing the group would be looking for suitable pub restaurant sites located in leisure and retail parks, and selling more than 300 mainly wet-led pubs to TDR Capital.

In a statement Lovering said it had been a "huge privilege" heading the company for the past year.

"The company is now on a much firmer footing than when I joined last year. Our board is strong and we have strengthened our executive team with five new executive committee members."

"Group profits have improved significantly in the last year thanks to our focus of switching from volume to spend per head and our core brands are successfully implementing their site expansion goals. We are continuing to trade well and gain market share. I would like to wish the business and its employees every success for the future," he added.

Analysts were divided over the news. Simon French of Panmure Gordon said: "We think that this announcement will disappoint the market given the strong progress made under his leadership. We also think it likely precludes any large scale merger and acquisition activity in the short-term."

However John Beamount of Matrix Group said he believed the move to be the right one for both parties. "It does not change our positive view of the company," he added.

M&B hosts its annual general meeting at the end of this week at which it will update shareholders on recent trading. Analysts expect like-for-like growth for the nine weeks to January 22, 2011 of between one and 1.5 per cent.

PIRC, the shareholder pressure group, is meanwhile urging investors to vote against the re-appointment of a number of non-executive directors at the meeting, arguing their independence is in doubt.

It says the six non-execs were nominated by Piedmont, which represents the interests of Joe Louis, who holds nearly 23 per cent of the company's stock.

This morning M&B's shares were trading down 6p at 343p.