Davis received £1.25m pay-off from Reed

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The Independent Online
Peter Davis, the former chairman of the Anglo-Dutch publishing company Reed-Elsevier and now chairman of Prudential Insurance, received a pay- off of at least £1.25m from Reed, not including shares granted under a complicated incentive plan.

The settlement, revealed in Reed-Elsevier's annual accounts, comprises a cash payment of £652,000, benefits of £70,000 and a top-up to his pension to provide part of his compensation tax-free.

In addition, Mr Davis will receive 6,032 Reed shares, worth £46,700 last night when Reed shares closed at 774.5p. Depending on the company's earnings- per-share growth in the period 1993-95, he stands to receive another 27,000 shares, yesterday worth about £200,000.

Mr Davis, who was paid a salary of £636,592 under a rolling three-year contract, could have received as much as £2m in compensation, under the terms of an agreement requiring three years' termination notice. The lower amount of £1.25m was the result of negotiations between Mr Davis and Reed.

The final package does not include options granted before his departure, which included options over 138,000 shares.

Mr Davis's successor, Ian Irvine, saw his salary rise from £490,000 to £630,000 when he became co-chairman of the group. He was also granted 178,000 options over Reed shares last year under the incentive scheme.

Mr Davis ran Reed for eight years, masterminding the company's push into publishing and engineering the merger with Elsevier. He left following a disagreement with the board.

Following several months of rumours that had him tipped to emerge as top man at several British companies, most notably Saatchi & Saatchi, Mr Davis was appointed to his current position at the head of Prudential Insurance.

His arrival at the Pru coincided with the ruckus over executive pay at several large British companies. Partly in response, his salary at the Pru is a more modest £400,000 a year. But that could double if peformance targets established under a bonus plan are met.