Morning:
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Tim Clarke just had to go, but in some ways it's a shame. The chief executive of Mitchells & Butlers stepped down last week at the second attempt, finally paying the price for a disastrous entanglement with Robert Tchenguiz.
Tchenguiz, then a major shareholder, wanted the pubs chain to spin off the properties in a sale and leaseback deal that was supposed to release cash to the investors.
They had one of three options: tell Tchenguiz to get stuffed; do the deal exactly as he wished; or offer him a compromise. They went for the third option and it was a catastrophe.
The deal collapsed anyway as the credit crunch hit, but the swaps the company had set in place to hedge against inflation or interest rate rises were left open.
They cost M&B £400 million last year and the best part of £100 million last week, causing Clarke to offer his resignation for the second time.
The pity is that the actual business is doing remarkably well. If M&B could have resisted the overture to turn itself into a hedge fund that happened to have some pubs attached, Clarke would now be looking like the smartest operator in the sector.
While Punch Taverns and Enterprise Inns are mired in debt, he'd be running easily the cleanest of the big pubcos.The bankers at Citigroup, Barclays and Royal Bank of Scotland who arranged these hedge deals haven't received enough attention for their own roles in this mess.
Clearly neither Clarke nor finance director Karim Naffah, earlier shown the door, understood the hedges. It's not clear the bankers did either.
One unanswered question is who was on the other end of these bets. Who made the £500 million Mitchells & Butlers lost?
The company says: no one did.
An adviser explains: "The analogy is if you're going on holiday in the United States in the summer and exchange currency at $1.50 now, if by the time you go it's $2 to £1, you suffer because your spending power is lower, but the bank hasn't made money because it sold the dollars to you at the prevailing price at the time."
If it's true that nobody made any money here, this was an innovative finance strategy indeed. Clarke can claim to be a genuine pioneer.
I met him for a few pints a while back at The Coal Hole on the Strand, one of M&B's better London pubs. The drinks were a kiss-and-make-up session after I'd written a piece about another company and contrasted their very good pubs with M&B's blander offerings. Clarke was good company and much less inclined to corporate platitudes than many chief executives.
"Call me an idiot," he said. "Say I'm a complete tosser. Just don't say I don't know what a good pub is." Sadly, Clarke did know good pubs and how to make money running them.
How he must wish he'd had the nerve to stand up to Tchenguiz. He would have been vindicated within months.
Still, there's no need to feel sorry for Clarke. As part of the now customary reward for mucking up, he'll get at least a year's money (£500,000-plus) and some other compensation.
According to the annual report, his pension fund is worth almost £7 million, about £350,000 a year. Cheers.
On your bike, Mike - this could be the death of me
My summer cycling routine goes like this: buy cheap bike in May, ride around until July. Have bike stolen. Trudge down to "second-hand" bike stall at Brick Lane, buy it back. Have bike stolen again. Get back on the bus.
This year's adventure could be even more short-lived than usual: I may die.
Last week, I headed to my local Sports Direct in search of top-quality leisure wear and some work shirts (shut it, there's a recession on).
It turns out that the Mike Ashley emporium has branched into bicycles. Only £49.99, "some assembly required".
In my case, after hours of futile nut-fiddling, this assembly was required to be done by the Mexican man at the local bike shop.
He welcomed me back after a 12-month absence and informed me that this year's effort is the worst yet: "it's a really, sheety bike," he says, though it does have personality. The brakes are temperamental, the gears moody and the seat positively hostile.
So far it has cost me £50 to buy and £60 to repair.
I also notice that even though it weighs a ton, the maximum weight it reckons it can deal with is 90kg. So that's touch and go.
I predict a flood of accidents involving occasional bicyclists on Ashley's two-wheelers in the next three months. The Newcastle United owner has got enough problems. Another one may be a class-action lawsuit. Sign me up.
Ashley should just stick to what he's brilliant at (polo shirts, tracksuits) and leave all the other stuff to Halfords.
Bostock can defy critics in rapid rise to M&S top role
If you ask the City's retail scribblers whether they think that Kate Bostock might succeed Sir Stuart Rose at the helm of Marks & Spencer, you get abuse.
"No chance" and "God, I hope not" were the politer responses that were received from the retail-watching community.
I think the analysts have got this one wrong. Bostock is clearly in with a shout, and may even turn out to be Sir Stuart's preferred choice.
And as long as Rose keeps falling out with and firing other internal rivals (Carl Leaver most recently), her stock can only rise.
Bostock's ascent has been rapid, almost as if she were being groomed.
She joined the board as head of womenswear barely a year ago, since when her portfolio has expanded rapidly.
Last week she got promoted again, and is now in charge of the entire general merchandising division.
At the moment, the City likes the idea of finance director Ian Dyson taking the step up, assuming that its preferred option of Sainsbury's Justin King, via a merger or otherwise, is not a runner.
The case against Bostock is that she doesn't have enough hard financial experience. But it's got to be easier for her to learn number-crunching than it might be for Dyson to discover an eye for colour and a feel for what makes a nice frock.
In any case, one feels that those objections would not be raised in the first place if Bostock were male.
"Stick to the clothes, love" is roughly the tone of voice in which her credentials are dismissed.
