Rose in line for £2m pay-off if Green bid for M&S succeeds

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The Independent Online

Stuart Rose, the new chief executive of Marks & Spencer, will be entitled to a £2.1m pay-off if Philip Green's bid for the retail chain succeeds.

Stuart Rose, the new chief executive of Marks & Spencer, will be entitled to a £2.1m pay-off if Philip Green's bid for the retail chain succeeds.

M&S's boardroom clearout yesterday triggered a flurry of pay-offs and pay deals with the outgoing chairman Luc Vandevelde receiving more than £500,000 in M&S shares and Roger Holmes, the former chief executive, receiving a pay-off of more than £800,000.

Mr Rose said yesterday the M&S job was the culmination of his retail career, although he failed to stem speculation of a further management cull at the high street chain.

Asked if Vittorio Radice, the former Selfridges boss brought in by Mr Holmes to run M&S's clothing business, would be ousted, Mr Rose said: "I am talking to all the executives. I am an inclusive person. I don't believe that just because I am the chief executive I have exclusivity over good ideas.

"I'm a consensus manager but I believe in taking decisions and I think I am reasonably good at delegating. This is not a one-man show.

"This is not the Stuart Rose, M&S show. It's about leading a team of people."

However, Mr Rose may have to take some decisions more quickly than he would have liked. It is understood that Mr Green is planning to unveil details of his cash and shares offer for M&S tomorrow. He will point to the success of his turnarounds at Bhs and Arcadia as clear evidence of his ability to improve the prospects of M&S. Mr Green is thought to be willing to pay about 400p a share, valuing M&S at £9bn.

However, the details of the pay package agreed for Mr Rose, who has been brought in to fend off Mr Green's bid and improve M&S's operations, will reinforce his reputation as one of the country's luckiest businessmen, as well as one of its most effective operators.

M&S said Mr Rose would be paid a £1.25m golden hello to sign on with the company. This will be paid after he has been at the company six months or at the end of any offer period, whichever is the latest.

He will also get an annual salary of £850,000 - a substantial premium more than that of his predecessor - with a maximum bonus potential of 100 per cent of his base salary.

The company has agreed to give him 12 months' notice, should it wish him to quit which means a successful bid from Mr Green would see him receive his golden hello and also a full year's salary, bringing his pay-off to £2.1m. For his part, Mr Rose will be required to give M&S six months' notice of a decision to quit.

Mr Rose said: "Everybody needs a bit of luck and I don't deny I have had my fair share but I've also done my time at the coal face. I've done 33 years in retail, I would hope this is the culmination of my retail career."

Controversially, M&S is also proposing to give Mr Vandevelde, the outgoing chairman, a full 12-months' pay-off even though he has already agreed to stand down as chairman after admitting to not having enough time for the M&S job because of his widening circle of outside business interests.

The company said: "Luc Vandevelde will receive 12 months' payment in lieu of notice. As Luc is paid in shares, this will be 162,000 shares to be purchased within 14 days of 31 May 2004."

The takeover attentions of Mr Green has sent the M&S share price soaring in recent days. It ended trading yesterday at 365p, valuing Mr Vandevelde's pay-off at £591,300. Roger Holmes, the former chief executive of M&S who is making way for Mr Rose, will receive a £820,000 pay-off. Both Mr Vandevelde and Mr Rose are entitled to exercise their existing share options at anytime within the next 12 months.

Mr Rose is no stranger to the "lucky" tag. He has picked up substantial pay-offs wherever he has worked and Mr Green's apparent determination to win control of M&S means he may well enjoy another for doing only a short period of work.

However, having already spent 17 years at M&S previously in his career, Mr Rose said his experience of the inside of the company as well as working elsewhere would stand him in good stead to lead a recovery at the ailing retail chain.

Rose to riches

1997: Stuart Rose receives £600,000 when leaving Arcadia for the first time, having seen John Hoerner get the job of chief executive. Also bags £540,000 for three months' work after joining Argos and fighting a losing bid battle against GUS. Joins Booker, the cash and carry business

2000: Mr Rose quits Iceland, the frozen food group, after seeing the retailer buy out Booker triggering a £2.2m share option windfall for Mr Rose. He leaves to become the chief executive of Arcadia on a salary of £550,000 after Mr Hoerner is ousted.

2002: Philip Green agrees to pay 408p a share for Arcadia, leaving Mr Rose out of a job but richer by more than £25m thanks to a huge share option deal agreed when he took over the ailing Arcadia business.

2004: Mr Rose joins M&S, the company he sees as the culmination of his retailing career. He will receive a £1.25m signing-on fee and an annual salary of £850,000. His annual bonus will be up to 100 per cent of salary and his pay-off, should Mr Green or any other bidder succeed in buying M&S, will be £2.1m.