The Melrose Four made £170m before GKN deal
FOUR bosses at the City predator trying to buy engineering firm GKN were paid nearly £170million last year.
The executives who run turnaround specialist Melrose scooped more than £42million each in 2017, according to company accounts filed last night.
They are now chasing an even bigger payday through the planned £8billion takeover of GKN. Capturing the historic British firm could net them a further windfall of around £285million.
As pressure mounted on Business Secretary Greg Clark to block the GKN deal, campaigners branded the pay deals the ‘unacceptable face of capitalism’.
Melrose chief executive Simon Peckham, 55, took home £42.7million, chairman Christopher Miller, 66, was paid £42.3million, David Roper, 67, earned £42.3million, and finance chief Geoffrey Martin was handed £42.5million.
‘These are extraordinary sums of money, ten times higher than the average for a FTSE-100 chief executive, let alone an ordinary worker,’ said Luke Hildyard, director of the High Pay Centre campaign group. ‘ Melrose are involved in a highly controversial takeover, supported by hedge funds and opposed by workers’ representatives.
‘To see a group of executives rewarded so extravagantly, by a committee of other wealthy business leaders and financiers at the same time, makes it very difficult to argue that the UK’s economic model is working functionally or fairly.
‘It makes Melrose look like the unacceptable face of capitalism.’
Sir Vince Cable, leader of the Liberal Democrats and former business secretary, said: ‘This is an absolutely scandalous amount of money. You have a British engineering company being taken over and the only people benefitting are the directors of Melrose and the market speculators.
‘It is a terrible way to treat British industry. I hope Melrose shareholders exercise some kind of discipline because this sets a terrible example in business.’
Melrose launched its takeover battle for GKN in early January. It narrowly won the bid less than two weeks ago, with 52 per cent of the vote of shareholders.
Its success came despite stiff opposition from politicians, unions, and some GKN customers and shareholders, who fear that Melrose’s model of selling firms on at a profit within three to five years will harm GKN and the UK.
Opponents criticised the fact that speculators bought up GKN’s shares during the bid process and made a killing when the takeover succeeded.
The four Melrose bosses’ huge pay packets last year came in the form of shares awarded under long-term incentive plans based on the company’s performance over the previous five years.
Each earned shares under a
‘Unacceptable face of capitalism’
long-term incentive plan worth £41.7million, in addition to a basic salary of £475,000 for Mr Miller, Mr Roper and Mr Peckham, and £380,000 for Mr Martin.
Melrose bosses are now in line for a potential £285million payday based on another incentive plan, which pays out in line with the company’s increase in value.
A Melrose spokesman said last night: ‘Melrose is a company which has tremendous support from long-term institutions, pension funds and investors who entrust us to look after their interests for the long term. We invest hundreds of millions in the businesses we own and that’s why they enjoy the success they do.’