Ferranti lifts chief's pay by 21%

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The Independent Online
EUGENE ANDERSON, Ferranti's chairman and chief executive, had a 21 per cent pay increase last year to pounds 464,000 from pounds 384,000 the previous year. The rise is in spite of the company's loss before tax of almost pounds 40m in 1991-92.

The company defended the increase, saying that all staff pay rises had been deferred from April to October 1991. A spokesman for Ferranti said that the increase included a bonus agreed when Mr Anderson was brought in early in 1991 to pull the company out of crisis.

Ferranti has been struggling to recover from a dollars 1.1bn fraud related to its takeover of International Signal & Control of the US. It has been disposing of assets and has sold its missiles business to GEC. By the end of this year, the workforce will have more than halved to 4,200 from 9,000 at the beginning of 1991.

Last week, Mr Anderson said that the results for the year to 31 March were unsatisfactory. But, he said, compared with losses of pounds 98m a year earlier they proved that the company was coming back from the brink.

The chairman said the 'life threatening' problems that have dogged Ferranti for over two years had been largely eliminated. 'Next year I would like to be able to talk about profit,' he said.

Although Ferranti is now viewed positively by City analysts, the pay rise could anger shareholders who have been told by the company that no dividend will be paid for some time.

Some shareholders are entitled to a share of recovered funds related to the fraud. So far pounds 40.1m has been recovered and the company has dollars 189m in judgments outstanding against individuals in the US. These include James Guerin, who sold ISC to Ferranti and who has been sentenced to 15 years in jail.

However, Mr Anderson is pessimistic about the chances of recouping the money in the forseeable future. He also said that in any case, Ferranti is in no position to make a payout, even where it is from recovered funds.