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Melrose announces pay review before AGM
Melrose Industries said it would review its pay arrangements and consult with shareholders as it prepared for a potentially rocky annual general meeting.
The company, which buys manufacturers and seeks to improve their performance, said the pay review was prompted by its £8bn hostile takeover of GKN which pushed Melrose into the FTSE 100 index. It gave no further details.
In a trading update before the AGM, Melrose said: "Given the recent acquisition of GKN, your board intends to review the existing Melrose remuneration arrangements and expects to consult with shareholders in the coming months."
Melrose chairman Christopher Miller and three other executives were paid at least £42m each in 2017 as they received payments under the company's long-term incentive plan (LTIP). Shareholders will vote on the pay report at the meeting on 10 May.
The payments were opposed by Glass Lewis, a leading shareholder advisory group. Glass Lewis said the payments were excessive and far bigger than those at similar sized European companies.
ISS, another proxy adviser, gave the pay report qualified backing because the 2012 LTIP plan was approved by shareholders.
In its update, Melrose gave no trading information about GKN. It said its ownership of the engineering company reached 94% on 9 May and was expected to reach 100% in June.
Nortek, a US ventilation equipment maker owned by Melrose, will launch new products in the next year. If exchange rates remain stable Nortek's annual results will be reduced by about 11%. Trading at Brush, the ailing power generation specialist, is unchanged and its restructuring is on time and on budget, Melrose said.
Miller said: "We are very excited by what is in store for Melrose over the next few years. We look forward to working with the GKN employees to transform the prospects of the businesses through significant investment. Nortek and Brush also remain an important focus for Melrose with continuing plans to increase their value and prospects."