Granada Under Fire By Shareholders
LONDON (AP) _ Granada Group PLC, a leisure and entertainment concern, ran into a storm Wednesday when shareholders attacked big payments that directors took before agreeing to take less severance pay if the company is acquired.
Five directors received payments that between them total a reported 375,000 pounds, or $600,000, for agreeing to cut their severance notice _ in the event of a corporate takeover _ to two years from three.
Director John Ashworth, a member of the committee that sets pay for top Granada executives, bore the brunt of the criticism.
Ashworth was up for re-election and got ``no″ votes from holders of 83 million shares, or 19 percent. Holders of another 50.8 million shares abstained, giving Ashworth 70 percent of the votes, not the best of margins in a corporate election.
Executives often keep their jobs by much higher majorities.
The Granada chairman, Gerry Robinson, who is reported to have gotten 140,000 pounds ($224,000) in the deal, found himself on the defensive.
Robinson called the payoffs a ``reasonable settlement″ and told shareholders at the annual meeting ``we thought people would applaud our honesty.″
``I genuinely am sorry that we have ended up with a lot of shareholders who feel upset about this,″ Robinson said.
One investor pointed out that Robinson is now chairman of a British arts council where he spends one day a week and suggested the chairman’s salary at Granada should be reduced accordingly.
Robinson replied that the remuneration committee would no doubt take this into account.