The 16 senior managers at London Weekend Television are beneficiaries of a 'golden handcuffs' share option scheme that was worked out in 1989 during the TV franchise battle. It will yield its luscious fruit this September.
Sir Christopher Bland, LWT's chairman, should soon find himself pounds 7m richer, while Barry Cox, director of corporate affairs, may have to be happy at No 16 in the LWT millionaires' chart with a mere pounds 1.2m.
Melvyn Bragg, head of arts, stands to gain pounds 2.2m. In addition to the top 16, 38 other managers will make between pounds 700,000 and pounds 70,000 each.
News of the payouts may add to the financial regrets of one famous former employee. John Birt left LWT in 1987 to become the BBC's Director-General in waiting. It is believed that Mr Birt, LWT's former director of programmes, gave up more than pounds 100,000 of share options to join the Corporation. He could not have known then that he was a millionaire-in-waiting. Yesterday LWT said the deal, devised by the managers now so richly rewarded, was not conceived until two years after Mr Birt's departure. The course of broadcasting history might have been so different.
Nick Elliot, Mr Birt's successor, will make pounds 2.2m from the new deal. Mr Birt's BBC pay package is just pounds 200,000 a year. To many industry insiders that situation is not without its irony. The sums bandied about in the recent row over Mr Birt's taxes seem like small change now.
The BBC Director-General, on holiday and unavailable for comment, has at least avoided another unseemly financial scrap. Yesterday Bectu, the broadcasting union, denounced the share scheme as 'obscene' and its Stage Screen and Radio magazine, which published the millionaires' table, hit out at the 'greed' of managers when jobs were being cut.
LWT said the scheme was necessary to prevent top executives being poached by competitors when its franchise was up for grabs. Competition was expected to be fierce. In fact only one company - London Independent Broadcasting - bid against LWT and it failed to cross the 'quality threshold' set down by the Government.
LWT admitted the 'stay' strategy seemed flawed in the cases of Roy van Gelder, former director of personnel, and Peter McNally, former finance director, who have since retired. Despite their age, a spokesman said there was still a danger they might take their expertise elsewhere. Marcus Plantin, LWT's director of programmes, who stands to gain pounds 1.2m, has also left LWT to become ITV Network director. LWT said the fivefold increase in the reduced 83p share price offered to executives was 'completely unexpected'. The Financial Times' Lex Column said the managers' rewards were 'out of all proportion' to their risks and efforts.
Sir Christopher, the only millionaire available for comment yesterday, said the reward was justified because the management was responsible for the rise in the share price.
Although LWT shareholders approved the deal, some institutional investors complained it was 'too generous'. Sir Christopher expected no fresh criticism: they too had benefited from the company's performance.
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