UPDATE 2-Sports Direct shareholders approve Mike Ashley's bonus scheme

Wed Jul 2, 2014 10:22am EDT

* Shareholder vote gives 60.4 pct backing to bonus scheme

* Scheme could pay out 200 mln stg if targets hit

* Previous schemes rejected by investors as too easy (Recasts, adds further details)

By Paul Sandle

LONDON, July 2 (Reuters) - Sports Direct's Mike Ashley could be in line for a multi-million pound payout from the retailer he founded after shareholders backed a controversial bonus scheme at the fourth time of asking.

Ashley, who owns 58 percent of the firm, receives no salary or other bonus and did not vote on the scheme himself.

On Wednesday, he was backed by 60.4 percent of the remaining investors who did vote, overcoming the complaints of shareholder groups and corporate lobbyists, one of which said it was unthinkable that a major shareholder should receive a bonus, even if he was an executive.

Previous attempts to reward Ashley, who also owns English soccer club Newcastle United, have been quashed by shareholders who said the targets were too easy.

In the 2015 bonus plan, which could pay out 200 million pounds ($340 million) to an undisclosed number of employees including Ashley, earnings would need to more than double over the next five years.

Chairman Keith Hellawell said the company had listened to investors, and its share scheme was one of the most wide reaching and successful in Britain.

"Today's vote in favour of the resolution will ensure that the group continues to retain and motivate its hard-working employees," he said in a statement.

"The resolution today also recognises the substantial contribution made by Mike Ashley over many years and, as demonstrated by the previous schemes, has the potential to create a further significant increase in shareholder value."

Shareholder and business lobby groups had called on investors to oppose the scheme, saying it was structured just to suit Ashley.

The controversy about the payment would have come as no surprise to Ashley, who is deputy executive chairman of the group he founded in 1982.

His relationship with investors has been fractious since the group listed at 300 pence a share in 2007, only to issue what was interpreted as a profit warning just eight weeks later.

It took five years for the shares to trade above the issue price, but they have since performed strongly as the group has grown to more than 400 shops in Britain and 260 stores in continental Europe.

Sales reached 2.19 billion pounds in its last financial year, and core earnings rose 22 percent to 288 million pounds.

The shares were little changed at 722.5 pence at 1350 GMT.

($1 = 0.5877 British Pounds) (Editing by Kate Holton and Mark Potter)

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