Jul 16, 2014
Sports Direct's Ashley withdraws from 2015 bonus scheme
Jul 16, 2014
LONDON, United Kingdom - Sports Direct's founder Mike Ashley has withdrawn from participation in the sportswear retailer's 2015 bonus share scheme just two weeks after it was backed by a small majority of independent shareholders.
The retailer's non-executive chairman Keith Hellawell on Wednesday blamed "recent unhelpful speculation" surrounding the size of Ashley's potential payout for his withdrawal from the scheme.
Sports Direct said that after talks with the board's remuneration committee, executive deputy chairman Ashley had informed the board he did not wish to be awarded any shares under the new scheme.
The 2015 bonus plan could pay out 200 million pounds to an undisclosed number of Sports Direct employees if earnings more than double over the next five years.
Sports Direct, Britain's biggest sportswear and sporting goods retailer, said Ashley had also informed the board that while the 2015 bonus share scheme is in place he does not expect any other share based incentive scheme to be proposed to shareholders in relation to his role as an executive director of the firm.
Hellawell said Ashley remained fully committed to achieving the scheme's stretch targets.
"Regarding the allocation of shares, Mike's focus is on ensuring that the scheme aligns all employees to achieve the company's objectives," he said, adding "he is determined to ensure that there is the maximum number of shares available for the eligible employees."
Ashley, who owns 58 percent of Sports Direct, receives no salary or other bonus and did not vote on the scheme himself.
On July 2 he was backed by 60.4 percent of the remaining investors who did vote, overcoming the complaints of shareholder groups and corporate lobbyists, one of which said it was unthinkable that a major shareholder should receive a bonus, even if he was an executive. Previous attempts to reward Ashley, who also owns English football club Newcastle United, have been quashed by shareholders who said the targets were too easy.
Shares in Sports Direct, which is due to publish final results on Thursday, closed Tuesday at 704.5 pence, valuing the business at 4.2 billion pounds. They have risen 19 percent over the last year.
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