In a world of hyperbole, legend is a word much overused. But in the case of Ian Payne MBE, its an honorific that feels wholly justified.
The tenure of his career in the sector is remarkable enough on its own.
Consider for a moment that when he managed his first pub in 1973, Dark Side of the Moon was released, the modern London Bridge opened, and the UK joined European Economic Community (Apologies Ian!).
The world has changed drastically since, but by all accounts, his commitment and passion for the sector, through all its twists, turns and evolution, has remained constant.
Like many of his peers, he rose through the ranks of Whitbread, also cutting his teeth at Guinness and Bass Taverns.
His time in the sector takes in a raft of seismic changes, including the Beer Orders, which led to the breakup of the big six breweries and emergence of pubcos, as well as the smoking ban, supermarket price wars, the 2007 global financial crisis, the Covid-19 pandemic and more recently food price and energy inflation and cost of living.
His contribution was recognised in 2018 when he was appointed a Member of the British Empire (MBE) in the Queen’s Birthday Honours list. He has also won numerous industry awards, including Lifetime Achievement at MCA’s Reatilers’ Retailer Awards in 2019.
A canny operator, he has partnered with some pivotal and colourful characters, including the property tycoon Robert Tchenguiz. At one stage he ended up working with Icelandic civil servants after the financial crash saw investment banks bailed out and nationalised.
Amid plenty of turbulence, time and again his success and longevity has been characterized by a deep, on-the-ground familiarity and understanding of pubs and how they tick.
Like a London cabbie’s Knowledge, he wields an encyclopaedic mastery of Britain’s pub estate, and has been able to translate this insight into scores of deals.
One big deal in 2001 involved the buyout of some 3,000 Whitbread pubs when he was CEO of Laurel Pub Company.
This saw him go full circle and acquire The Bull Inn, in Barming Kent – 28 years after he first managed the pub at the beginning of this career.
When he was at Bass meanwhile, he sold 372 pubs to Ted Tuppen’s Enterprise Inns in 1991, and he later became reacquainted with some of those pubs when Stonegate acquired EI Group many years later.
I’ve had the fortune of interviewing him twice on stage in recent years, where he revealed his preference for being out on-site, rather than in a head office, where “you don’t actually learn anything”.
While he might spend time with investors and the senior management team, he cited being on the ground as the “single most important thing”.
“People sit there and tell me what they think I want to hear,” he said. “The only way to find out what’s going on is being out in the field, out on the sites, talking to the people that run the pub.”
While his longevity is impressive, what is perhaps even more remarkable is one of his most active periods was in the last 13 years at Stonegate, which he described as the “greatest privilege in my long career”.
He co-founded the company with the backing of TDR Capital with the acquisitions of 333 pubs from Mitchells & Butlers.
Alongside CEO Simon Longbottom they created a managed pub powerhouse through a series of acquisitions, including his old outfit Town & City, as well as Slug & Lettuce, Walkabout, Be at One and Fever Bars among others.
The biggest deal of all was of course Ei Group, which positioned Stonegate as the biggest pub company in the UK, with a strategy to convert large parts of the vast leased & tenanted estate into its branded and operator-managed model Craft Union.
At The Pub Conference, he recounted the time he was sitting with his senior team in Greene King’s Hillfield Farm pub in Solihull, on “a horrible wet day”, awaiting confirmation the deal would go ahead.
It was March 3, and while the contingent nervously waited for the phone to ring, a pub manager emerged, saying: “Congratulations on doing the deal – we made you this cake!”
“That is why I love this business,” Payne said. “Where else would you get that?”
The celebration and elation was unfortunately short-lived, and within 17 days would turn to dismay as the grim reality of Covid-19 began to sink in.
“I’m sitting there with a £1.5bn debt…and no business. It’s something I never want to go through again in my life,” he recounted.
Having endured such a bruising period, two years later when considering the new crop of challenges facing the sector, Payne remained bullish.
“Whenever my people tell me we’ve got problems, I talk about March 2020 when we didn’t have a business.
“We’re open. It’s now down to us to manage through all the issues that the industry is facing. At least we’ve got an opportunity because our business is there.”
Having stepped back from CEO roles and into chairmanships, Payne has seemed very much at home being the bridge between management teams and private equity investors, who he has worked with in various forms for the past 20 years.
“If their interests aren’t aligned you’re in real trouble,” he said. “Looking after investors, making sure they’re happy with the way the business is going; looking after the executive team and making sure they’re getting properly remunerated and rewarded, and it’s one big happy ship. It doesn’t always work like that, but that’s got to be the key aspect.”
Payne’s last big task was to appoint a new CEO, after the unexpected resignation of Simon Longbottom, who has moved to Australia for a quieter life.
His appointment, former BrewDog COO David McDowall was not necessarily tipped for the role, having not held a big CEO role before, but like Payne, has has lived and breathed pubs for his whole career.
He also brings an “edginess” the group was perhaps lacking before, as well as an intense focus on data insights and tech to drive revenue growth.
“I love him because he’s like me - he started out working at a bar. He never went to uni. He built his career at G1 and then at BrewDog. He’s very much a pub and bar man.
“He’s got that brewing understanding as well. He’s going to bring that energy and that creativity, which is what I’m looking for.”
Having successfully executed scores of big deals, one problem Payne will no longer have to worry about - but which he may wish he could have resolved is - is the sale of a 1,000-strong package of former Ei pubs.
It has been speculated the group would want to sell some of the vast Ei estate ever since the deal was announced. While never officially confirmed, the group reportedly started marketing the package in the early part of 2023, as more than £2bn of maturities approach in July 2025.
Market conditions appear to have conspired against this however, with high inflation driving a wedge between what buyers are willing to pay, and what sellers think their pubs are worth in more stable conditions.
According to Bloomberg, Stonegate is now proposing to split the package into a special purpose vehicle to raise debt from outside parties. The report comes as Moody’s forecasts the ratio of net debt to profits to be more than eight times at the end of 2023.
A big task for Mr Payne’s successor to get their teeth into – and a big chair to fill at the helm of Britain’s biggest pub company.
