Windfall for boss's family as Drax shares the spoils

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Gordon Horsfield, the outgoing chairman of power group Drax, and his children stand to make nearly £7m out of their shareholdings over the next four years.

Analysts estimate that Drax will make a £950m profit after tax and capital expenditure between 2008 and 2012. The company's stated aim is to hand back surplus cash to shareholders, meaning Mr Horsfield and his family could make £6.65m. The windfall could be even higher if Drax achieves top-of-the-range predictions of around £990m.

Equally, it could be hit if Drax continues to struggle to refinance a debt facility that expires in 2010. The company postponed refinancing before Christmas as a result of the market turmoil. Senior secured debt stood at £405m at the end of last year.

Mr Horsfield transferred a 0.34 per cent stake to his children last week to escape the near-doubling of capital gains tax in April. This left him with 0.36 per cent of Drax, worth around £6m.

A Drax spokeswoman said: "Our policy is to distribute substantially all of the surplus cash after we have taken care of the business's needs."

There is also a policy of giving back at least £50m to shareholders each year, which would total £250m to 2012. The remaining £700m would be considered a special dividend.

Mr Horsfield steps down from his non-executive chairman role next month. He will be replaced by non-executive director Charles Berry.

Drax's most famous asset is the eponymous power station in Selby, North Yorkshire.

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