25th Aug 2021 19:30
(Alliance News) -Â Frasers Group PLC late Wednesday set out pay plans for incoming chief executive Michael Murray ahead of its annual general meeting next month.
The House of Fraser and Sports Direct owner said that within the resolutions to be put forward at September 29's AGM, it is recommending a new executive share scheme which includes a share option scheme for Murray, should he assume the role of Frasers CEO in May next year as expected.
"In considering a remuneration package, the Remuneration Committee was mindful of setting targets that were both stretching and achievable and that would reward an incoming CEO commensurately with the shareholder value that could be attained," said Sports Direct.
The proposed share option scheme for Murray has a target price of GBP15, which must be achieved for 30 consecutive trading days before the vesting period ends on October 7, 2025.
Shares in the FTSE 250-listed retailer closed up 2.1% at 650.00 pence in London on Wednesday, the stock up 44% since the start of 2021.
Should the options vest, and the share price on exercise be GBP15, Murray will be awarded shares to the equivalent value of GBP100 million before tax.
"The board believes that the significant increase in value of the shares to be achieved before Michael's share option award vests is suitably challenging but achievable and would be evidence of the success of the group's elevation strategy and Michael's leading role in this," the company said.
The board is also recommending he be paid a salary of GBP1 million per year.
As announced earlier in August, current Frasers CEO, Mike Ashley, is planning to step down from his role and move into an executive director position.
Taking over is his future son-in-law, Murray. Murray is currently the company's "head of elevation", meaning upgrading stores, and he is expected to take up the CEO role in May 2022.
Ashley founded the company in 1982 and still owns 64% of it. He had been executive deputy chair until taking back over as CEO in 2016.
Frasers added on Wednesday: "For the avoidance of doubt, the previous consultancy arrangements between the group and Murray will cease on his assumption of the CEO role."
By Lucy Heming;Â [email protected]
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