Sports Direct International Plc, the U.K.’s biggest sporting-goods retailer, said investors approved a multimillion-pound bonus for billionaire founder Mike Ashley, succeeding in passing an award that was blocked twice before.
A proposed bonus plan in which Ashley is eligible to participate was supported by 60.4 percent of shareholders, the company said today in a statement after its annual general meeting in Shirebrook, England.
Sports Direct has faced a barrage of criticism for its efforts to reward Ashley, who owns a 58 percent stake yet has never received a salary for his role as deputy chairman. The U.K. Institute of Directors said yesterday that the retailer’s latest plan was “excessively generous” and suggested “weak underlying governance at the company.”
Sports Direct Chairman Keith Hellawell said today that the company had responded to feedback from shareholders, who in April rejected a bonus package for Ashley that would have given him 8 million shares, worth 58 million pounds ($100 million) at current prices. The previous proposal, like a plan two years before it, didn’t make it as far as a vote.
Ashley, who founded the company in 1982, has an estimated wealth of about $6.1 billion, according to the Bloomberg Billionaires Index. The executive, who also owns Premier League soccer club Newcastle United, has led an expansion of the retailer to about 400 stores in the U.K. and about 270 in 19 other European countries.
The terms of the 2015 bonus plan provide for the grant of no-cost options over as many as 25 million ordinary shares, amounting to about 4.2 percent of the share capital. For employees to receive the bonus, the company must achieve earnings before interest, tax, depreciation and amortization of 480 million pounds in 2016, 570 million pounds in 2017, 650 million pounds in 2018 and 750 million pounds in 2019.
If the performance targets are all met, a quarter of the award would be paid after the announcement of the company’s 2019 results and the rest after the 2021 earnings.