Oates was ousted from M&S with pounds 1.2m pay-off

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KEITH OATES, the former deputy chairman of Marks & Spencer who quit after losing a dramatic battle to become chief executive, left the struggling retailer with a settlement worth pounds 1.2m, it emerged yesterday.

Mr Oates was paid pounds 587,000 for the termination of his contract with an additional retirement package worth pounds 581,000 over three-and-a-half years. The details are revealed in the company's latest annual report and accounts.

Mr Oates was defeated in the high-profile struggle for the top job at M&S late last year by Peter Salsbury, who took the helm in February on a salary of pounds 560,000. None of the board of directors were paid a bonus for the last financial year after profits fell by 40 per cent.

Sir Richard Greenbury, who split his joint role as chairman and chief executive, was the highest paid director with salary and benefits of pounds 810,000 for the year to the end of March.

This was down on the previous year's pounds 969,000. In his new role as non- executive chairman, Sir Richard's pay will fall to pounds 450,000.

The annual report also details the compensation paid to three other directors who were eased out as a result of a wide-ranging shake-up introduced by Mr Salsbury. Derek Hayes was paid a package worth pounds 589,000, Chris Littmoden pounds 420,000 and John Sacher pounds 106,000.

As part of a plan to reduce costs and increase accountability, the remaining directors at M&S have all had their pay frozen at last year's levels.

A spokeswoman said: "The board are very aware that we are going through a difficult period. They have not had a bonus and are not getting any increase in salary."

In the report Sir Richard Greenbury warned that trading would continue to che challenging for the rest of the year. Mr Salsbury said recovery would take time. "Shares may not regain their recent value within the next year."