Hills/GVC takeover could earn Sportingbet chief £2.4m
CEO Andy McIver and CFO Jim Wilkinson could be due two years' salary each under terms of contracts drawn up before operator's main market move.
Sportingbet chief executive Andy McIver and chief financial officer Jim Wilkinson could be set for substantial payoffs if they leave the company following proposed acquisition by William Hill and GVC is completed.
Hills and GVC were granted a second extension last week and the two operators now have until 5pm on 4 December to lodge a bid which would see the London-listed business divide its regulated and unregulated offering between the two joint-bidders.
The agreement, which would see Hills take over Sportingbet’s Australian business and GVC assume control of its offering in markets such as South America and Germany, values Sportingbet at £530m.
However, according to reports in newspaper The Daily Telegraph, if McIver and Wilkinson leave the company following the completion of such a sale, the pair would be entitled to two years’ worth of salary, bonuses, pension payments and other benefits. McIver would be due up to £2.4m under these conditions, with Wilkinson due a smaller amount.
It makes reference to the operator’s annual report, made available to the public last week, which states: “In the event of termination or constructive dismissal following a sale or reconstruction of Sportingbet each of the executive directors is entitled to the equivalent of 24 months’ salary, bonus, pension contributions and other benefits payable under his respective service contract.”
The report acknowledges that “This entitlement is not in accordance with…the UK Corporate Governance Code [as] the contracts were drawn up before the Company had obtained a Premium Listing, at a time when it was not bound by the Code.” Sportingbet moved to the main market in May 2010, having previously been listed on the Alternative Investment Market (AIM).
Another element of executive remuneration to predate the admittance to the main market is the 2008 Cash”Based Long”Term Incentive Plan – also mentioned in the 2012 report – which saw McIver and Wilkinson awarded cash sums of £500,000 and £293,500 respectively. As with the proposed post-sale payments, Sportingbet acknowledges that this is not in line with the UK governance code.
At last year’s annual general meeting, 13.9% of Sportingbet shareholders opposed the approval of the operator’s remuneration report, and a spokesperson for shareholder group Pirc told the Telegraph: “These contract provisions are well out of line with best practice, which is why we, along with other shareholders, opposed the company’s remuneration report last year.”