First Leisure investors poised for revolt over Grade's pay

A shareholder revolt is brewing at First Leisure, the bingo to bowling group, over Michael Grade's controversial pay package. The former head of Channel 4 joined the company as chairman last summer and stands to receive more than pounds 4.5m over the next four years.

Institutional shareholders are also angry at the pounds 79,000 paid to Michael Payne, First Leisure's managing director, to extend his contract from one to three years, in direct conflict with corporate governance guidelines.

Institutions may seek to block the introduction of Mr Grade's new long term incentive plan. Several large shareholders are also threatening to vote against the re-election of three of the group's directors unless First Leisure comes up with satisfactory answers to their grievances. Joe Bollum, David Ducks and John Woolf, who all sit on the remuneration committee that agreed the payouts, could face opposition to their re-appointment at the group's AGM on March 17.

One fund manager said: "We are seeking clarification on the reason for these payments. This is far from over and the agm will be the focal point for concerns from shareholders."

Institutions have raised concerns over Lord Rayne and Robbie Rayne, the father and son team that sits on the remuneration committee. They are both directors and substantial shareholders of London Merchant Securities, the property group which was an original shareholder in First Leisure and which still has a major stake in the group. Another institutional shareholder said: "Their attitude to best corporate practice looks suspect."

Mr Grade's pay is pounds 510,000 a year, well in excess of the pounds 450,00 he earned as head of Channel 4. He is also entitled to a bonus for achieving a growth in the group's earnings per share and share price of just 2 per cent over and above the rate of inflation. The maximum payout under the scheme is pounds 625,000 a year if Mr Grade can achieve 6 per cent growth.

First Leisure tried to play down the extent of shareholders worries yesterday. Graham Coles, the group's finance director, said: "The institutions have not expressed any concerns to us. The performance criteria that Mr Grade has to meet are tougher than those of John Conlan [the group's former chief executive]."

First Leisure shares have underperformed the market by more than 30 per cent in the last 12 months.

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksA special investigation by Andy McSmith
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Guru Careers: Stockbroker

£Basic (OTE) + Uncapped Commission: Guru Careers: A Stockbroker (qualified / p...

Recruitment Genius: Financial Adviser

£20000 - £60000 per annum: Recruitment Genius: Are you recently QCA Level 4 qu...

SThree: Graduate Recruitment Resourcer

£20000 - £22500 per annum + OTE £30K: SThree: SThree Group have been well esta...

Guru Careers: Application Support Analyst / 1st Line Support

£25 - 30k: Guru Careers: We are seeking an Application Support Analyst / 1st L...

Day In a Page

Not even the 'putrid throat' could stop the Ross Poldark swoon-fest'

Not even the 'putrid throat' could stop the Ross Poldark swoon-fest'

How a costume drama became a Sunday night staple
Miliband promises no stamp duty for first-time buyers as he pushes Tories on housing

Miliband promises no stamp duty for first-time buyers

Labour leader pushes Tories on housing
Aviation history is littered with grand failures - from the the Bristol Brabazon to Concorde - but what went wrong with the SuperJumbo?

Aviation history is littered with grand failures

But what went wrong with the SuperJumbo?
Fear of Putin, Islamists and immigration is giving rise to a new generation of Soviet-style 'iron curtains' right across Europe

Fortress Europe?

Fear of Putin, Islamists and immigration is giving rise to a new generation of 'iron curtains'
Never mind what you're wearing, it's what you're reclining on

Never mind what you're wearing

It's what you're reclining on that matters
General Election 2015: Chuka Umunna on the benefits of immigration, humility – and his leader Ed Miliband

Chuka Umunna: A virus of racism runs through Ukip

The shadow business secretary on the benefits of immigration, humility – and his leader Ed Miliband
Yemen crisis: This exotic war will soon become Europe's problem

Yemen's exotic war will soon affect Europe

Terrorism and boatloads of desperate migrants will be the outcome of the Saudi air campaign, says Patrick Cockburn
Marginal Streets project aims to document voters in the run-up to the General Election

Marginal Streets project documents voters

Independent photographers Joseph Fox and Orlando Gili are uploading two portraits of constituents to their website for each day of the campaign
Game of Thrones: Visit the real-life kingdom of Westeros to see where violent history ends and telly tourism begins

The real-life kingdom of Westeros

Is there something a little uncomfortable about Game of Thrones shooting in Northern Ireland?
How to survive a social-media mauling, by the tough women of Twitter

How to survive a Twitter mauling

Mary Beard, Caroline Criado-Perez, Louise Mensch, Bunny La Roche and Courtney Barrasford reveal how to trounce the trolls
Gallipoli centenary: At dawn, the young remember the young who perished in one of the First World War's bloodiest battles

At dawn, the young remember the young

A century ago, soldiers of the Empire – many no more than boys – spilt on to Gallipoli’s beaches. On this 100th Anzac Day, there are personal, poetic tributes to their sacrifice
Dissent is slowly building against the billions spent on presidential campaigns – even among politicians themselves

Follow the money as never before

Dissent is slowly building against the billions spent on presidential campaigns – even among politicians themselves, reports Rupert Cornwell
Samuel West interview: The actor and director on austerity, unionisation, and not mentioning his famous parents

Samuel West interview

The actor and director on austerity, unionisation, and not mentioning his famous parents
General Election 2015: Imagine if the leading political parties were fashion labels

Imagine if the leading political parties were fashion labels

Fashion editor, Alexander Fury, on what the leaders' appearances tell us about them
Phumzile Mlambo-Ngcuka: Home can be the unsafest place for women

Phumzile Mlambo-Ngcuka: Home can be the unsafest place for women

The architect of the HeForShe movement and head of UN Women on the world's failure to combat domestic violence