pounds 5.5m City star is best paid woman

Carol Galley, one of the City's best-known fund managers, yesterday became Britain's highest-paid woman with a package worth pounds 5.5m.

The vice-chairman of Mercury Asset Management (MAM), one of the most successful managers of company pension funds, collected the windfall after exercising share options worth almost pounds 4m and receiving a bonus for the year of pounds 1.4m.

Her salary of pounds 210,000 almost paled into insignificance by comparison.

Ms Galley, 48, shared the bonanza with her fellow manager Stephen Zimmerman, whose total package last year also exceeded pounds 5m. Revelations about the huge payouts made to Ms Galley and senior colleagues at MAM are certain to rekindle the row over the size of rewards on offer in the City.

Ms Galley was the fund manager who sealed the fate of Sir Rocco Forte by backing Granada's pounds 3.8bn bid for his hotel and restaurant chain last year. Before that, she had claimed the scalp of Sir Christopher Bland, now the chairman of the BBC, by supporting Granada's bid for LWT, the tele- vision company that he once chaired.

Sir Rocco still holds Ms Galley responsible for the demise of his empire, believing that MAM egged Granada into launching its bid for the business. Her role in the epic Forte battle won Ms Galley the title of the City's Ice Maiden. She has a reputation of being a workaholic, arriving at MAM's offices near London Bridge before 8am and rarely leaving until late at night.

She is married to a German stockbroker and has no children. She and her husband relax at the weekends at a cottage in the south of France.

The daughter of a local government officer in Newcastle upon Tyne, Ms Galley studied modern languages at Leicester University and then joined the library of the investment department of SG Warburg, later to become MAM.

It was there that she honed her forensic skills in fund management, developing a reputation for being better briefed on company performance than some of the senior investment managers she was working for.

The reward fees paid to Mercury Asset Management's top managers reflect the company's huge success in building up a business that now controls pounds 90bn of pensions in Britain. Mercury manages funds for more than 50 of the biggest companies in the FT-SE100 index and runs five of the ten largest pension funds in world.