ITV's Allen under pressure over contract

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The Independent Online

Charles Allen, Granada's chairman, is to come under intense pressure to halve the length of his two-year contract now that its merger with Carlton is finalised.

The National Association of Pension Funds said yesterday that its members would demand the change ahead of the ITV merger deal being completed.

As Carlton and Granada announced their new company's proposed board, it emer-ged that Carlton's finance director, Paul Murray, had lost out in the battle to get the top finance job.

Mr Murray, 41, who has been finance director since the start of last year, is entitled to a two-year pay-off, which is likely to give him £412,000.

Henry Staunton, Granada's long-serving finance director, will be the merged group's new finance chief.

Michael Green, Carlton's chairman, will chair ITV plc, although it is unclear whether he will be an executive or non-executive. Mr Allen was confirmed as chief executive of the new company. Carlton's company secretary, David Abdoo, will have the same role in the enlarged company.

There will be two senior non-executive directors on the proposed board: from Granada, there is Sir George Russell, former chairman of the Independent Television Commission, and Carlton's Sir Brian Pitman, the ex-chief executive of Lloyds TSB. The pair will tour City institutions to seek investors' views on issues, including compliance with corporate governance codes.

Earlier this year, the NAPF mounted a strong protest against Mr Allen's two-year contract, which entitles him to £2m if he is ousted.

A spokeswoman for the NAPF said it would be "disappointed" if the new ITV plc did not take its criticisms on board. "Two-year contracts are now the exception, rather than the rule."

Granada said the terms of Mr Allen's new contract would be in the information sent to shareholders, once there is a final regulatory agreement for the deal. Carlton and Granada must agree the terms of the merger clearance with the Office of Fair Trading before it is ready for shareholder approval.

SMG, which owns two ITV licences outside the merger, is pressing the combined Granada-Carlton to sell their combined 50 per cent in GMTV, the national ITV morning licence, before the merger is finalised.