Sports Direct tries again to win backing for new Ashley bonus

Monday 09 June 2014 14.16
Founder and executive deputy Chairman Mike Ashley receives no salary or other bonus from Sports Direct
Founder and executive deputy Chairman Mike Ashley receives no salary or other bonus from Sports Direct

Sports Direct has convened a shareholder meeting to try to win backing for a new bonus scheme that would reward the company's founder Mike Ashley, after failing in previous attempts. 

Britain's biggest sporting goods retailer had to scrap plans in April for a vote on a share bonus scheme worth £73m for Ashley, after failing to win enough support. 

It set out plans today for a vote on a 2015 company-wide scheme, setting what it said were more stretching earnings targets over a longer timeframe that would be used to determine the size of the payouts. 

Under the proposal, earnings would need to more than double by the end of the period in 2019. 

Executive Deputy Chairman Ashley, who holds a 62% stake in the firm he founded in 1982, receives no salary or other bonus from Sports Direct. 

Sports Direct, which has over 600 sports stores in Europe, including several  in Ireland, grew rapidly during the economic downturn on demand for its value offers.

Its growth was supported by a mixture of acquisitions, expanding online sales and the demise of rivals like JJB Sports. 

The failed bonus scheme in April was the third attempt by Sports Direct's board to reward its founder in recent years. One previous proposal was knocked back by shareholders due to concerns over the related performance targets, and another failed to be put to a vote. 

Under the new plan, the scheme would grant up to 25 million ordinary shares in the company to eligible employees, including executive directors, amounting to around 4.2% of the issued share capital of the company.