Granada chairman awarded £1m shares incentive package

Charles Allen, chairman of Granada, the ITV broadcaster and programme maker, was yesterday awarded shares in the company worth about £1m at the current market price.

The 678,767 shares allocated to Mr Allen will be awarded in two equal-sized tranches over the next two years. To receive the shares, Granada must meet internal performance targets. The shares take the place of cash bonus payments.

Three fellow executive directors have also been given shares worth a combined £1.4m. All four executives also received options on more than 3.2 million shares at a strike price of 142.5p. Mr Allen spent £300,000 yesterday to buy 209,790 shares at 143p per share, raising his stake to 1.68 million shares worth £2.4m.

Granada stock bucked yesterday's renewed downturn in technology and media shares, adding a half-penny to 143p.

Whether the timing of the purchase will prove propitious for Mr Allen remains uncertain, however. The 43-year-old son of a Glaswegian hairdresser has lost £2m in the past year after buying 1.48 million shares in the company at the time of its flotation. Media stocks have plummeted since, amid a downturn in advertising volumes.

Mr Allen, who is paid salary of £900,000 a year, led in the options stakes with an award of 1.35 million shares.

Also in the share schemes is Steven Morrison, the chief executive, with an award of 363,478 shares and 723,760 share options. Henry Staunton, Granada's finance director, received the same number of shares and options. Graham Parrott, commercial director, was awarded 229,988 shares and 457,950 options.

For all four executives to receive the full allotment of share options, the company must meet performance targets relative to a comparative group of international media companies over three years. When the options are cashed in, the executives will receive the net differ- ence between the share price at the time and the strike price of 142.5p.

Advisers to the company said the deferred share award plan and the executive share option scheme had been approved by shareholders and was included in Granada's prospectus when the media company was split from its leisure and hospitality assets, now called Compass, a year ago. "The timing of this has been in the pipeline for a long-time," one source said.