All Bar One owner Mitchells and Butlers faces shareholder revolt over pay

LaToya Harding
·2-min read
WESTFIELD WHITE CITY, LONDON, UNITED KINGDOM - 2021/02/19: All Bar One in Tower Hill seen currently closed due to the Covi19 lockdown.
Pubs and restaurants can reopen outdoors from the 12th April after Boris Johnson announces his road map out of Lockdown for England. (Photo by Dave Rushen/SOPA Images/LightRocket via Getty Images)
A number of major institutional investors at the pubs group are planning to oppose the company’s remuneration policy. Photo: Dave Rushen/SOPA Images/LightRocket via Getty Images

Mitchells and Butlers (MAB.L), the owner of All Bar One and the Harvester chain, faces investor backlash over plans to introduce a new share scheme for executives, it has emerged.

The company is seeking to boost the guaranteed pay awards of its top bosses by replacing a performance-based share scheme with more certain annual awards.

A number of major institutional investors at the pubs group are planning to oppose the company’s remuneration policy, according to Sky News.

In a note to clients, Institutional Shareholder Services (ISS), an influential voting advisory firm, said that M&B's explanation of the shift in policy "mainly discusses retention and a goal to maximise long-term shareholder value, but it does not explain how it will achieve the latter".

It comes ahead of M&B’s annual meeting later this month. Several directors, including chairman Bob Ivell, also face substantial votes against their re-election.

A spokesman for the pub operator told the broadcaster that the company's remuneration committee "will continue to ensure that any value delivered to our executive directors is fair and appropriate in the context of the performance of the business and experience of our stakeholders."

READ MORE: Budget 2021: Brits will be able to buy their local pubs with government's £150m pot

The backlash comes in the wake of a £350m ($487m) capital-raising announced in January in a bid to stay afloat amid tighter COVID-19 restrictions that have shut its sites in Germany and the UK.

The business said it was examining an equity capital raise, which would see it raise money through the sale of shares. The board has been “unanimous in its support for these actions being taken,” it said.

The pub and restaurant operator has already cut 1,300 jobs as it tries to stem the operating losses it faces in the midst of successive lockdowns.

Mitchells & Butlers joins a chorus of others in the hospitality sector who have been struggling over the losses accrued from COVID-19.

In January it also urged the government to "better understand" the huge impact the latest lockdown restrictions had. It said it had a monthly cash burn of between £35m and £40m before a £50m debt service payment per quarter and the support on offer was clearly inadequate.

WATCH: What UK government COVID-19 support is available?