This week, while the rest of us were deciding whether it was worth dry cleaning our suits before and after IHIF or just doing a deep clean after, Keith Barr quit IHG.
Barr is within his rights: jobs for life are long behind us other than in the French civil service and the role of French president doesn’t open up again until 2027. He has also served as CEO for coming up to six years, which is industry standard, and has been at IHG for more than 14 years. It’s probably time for a new security pass.
And maybe also time for a new city. Last month, Barr described London as “not a very attractive place to list new companies”. As a not new company, he added that IHG was happy to list there, although the UK capital might like to consider becoming more competitive. His wishes were almost immediately heard, with the government making plans to burn all remaining laws to the ground, so he’s hardly leaving because he’s screaming into the wind.
Barr has also made money for the group, which is a real and central part of his role. When he became CEO in July 2017, market cap was £4.49bn. When he announced he was stepping down, it was £5.41bn. We’d all be happy to make a billion in just over a half a decade and to do so during a pandemic speaks to a quiet talent.
So no short drops off a long cliff for Barr, who has a reputation for being one of nicer CEOs in a sector where, to be fair, executives don’t tend towards the nutty, although exceptions of course exist and we’re always happy to hear about any chair throwing and hissy fitting.
Barr’s final day as CEO will be 30 June, after which he will remain available to support and advise the business until the end of 2023. He told analysts: “Now is the right time for me and my family to return to the US, given my daughters will be studying there.”
So where next? The obvious place is skin-care consultant. He’s 52 but looks 16. It was long assumed that he only got into the sector because having a colleague behind the bar was the only way he stood a chance of being served at one. So we’re all eager to hear about his monkey-gland supplier.
Back to that quiet talent. IHG is not quite up there with boring, boring Whitbread for taking a sober long-term view, but it is known that Barr was not allowed to do any giant monsters of deals by the board, with the $300m acquisition of Six Senses a high point. Very high indeed, it turned out, because the year after the world shut down, only to reopen with a roaring appetite for luxury spa breaks.
Other fun CEO moments were the rumours in 2020 of a merger with Accor and, while we have always favoured an Accor/Marriott tie up, one must embrace all the entertainment possible during a pandemic and we were all very sad when it fizzled out and was dismissed as exuberant chat. And we remind you that it’s not until 2027 that France gets a new ruler.
Will he do a reverse Frits van Paaschen and take over Nike? It seems unlikely. Barr is a non-executive director of Yum! Brands, which is based in the US, so maybe he’s in line to be the next Colonel at KFC. The chances of him taking over on the finger lickin’ front seem unlikely, given that the current CEO has been in post for only three years, but one should never knock the chance for a discounted bucket. Barr looks more of a hotel lifer, having started his career as a dishwasher as a teenager before moving into, amongst other roles, revenue management, and one doesn’t throw that kind of trauma away without making it pay.
One assumes Barr will want to go upwards (we base this assumption on our own shallowness, no offence meant, Keith) and in the US that means Hyatt, Hilton or Marriott. Marriott has just appointed Tony Capuano, which leaves Hilton and Hyatt.
Mark Hoplamazian has been CEO at Hyatt since 2006, but, as we saw this week, is still all over the deals with Mr & Mrs Smith and enjoying being the king of luxury and leisure just as luxury and leisure is where we’re all at. IHG uses Mr & Mrs Smith and Barr told analysts that the jury was still out on whether they would give it up (although he was clear that it was “a very, very small part of our loyalty earn and burn”).
So Hilton? Chris Nassetta has been there since 2007 and the Blackstone acquisition and, other than what we would refer to as That Business With Denizen, things have trotted along. OK there were some spicy times, like when the group lost 70% of its market value in 2009, but you can’t have everything. Nassetta’s family owns a ranch, will he be thinking about putting himself out to pasture?
The attraction for Barr would be, well, it’s Hilton. It too has no appetite for large acquisitions, preferring to grow its own brands, most-recently getting into the lower chain scale segments, so there won’t be any great excitement. But having kids go off to college may be excitement enough. For one thing, films we have seen suggest they’ll have access to fake IDs. See you at the Barr.