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CORRECTED-UPDATE 1-Sports Direct tries again to win backing for new Ashley bonus
June 9, 2014 / 6:40 AM / 3 years ago

CORRECTED-UPDATE 1-Sports Direct tries again to win backing for new Ashley bonus

(Corrects Ashley’s stake to 58 percent in paragraph 5)

LONDON, June 9 (Reuters) - Britain’s Sports Direct has convened a shareholder meeting to try to win backing for a new bonus scheme that would reward the company’s founder Mike Ashley, after failing in previous attempts.

Britain’s biggest sporting goods retailer had to scrap plans in April for a vote on a share bonus scheme worth 73 million pounds for Ashley, after failing to win enough support.

On Monday it set out plans for a vote on a 2015 company-wide scheme, setting what it said were more stretching earnings targets over a longer timeframe that would be used to determine the size of the payouts.

Under the proposal, earnings would need to more than double by the end of the period in 2019.

Executive Deputy Chairman Ashley, who holds a 58 percent stake in the firm he founded in 1982, receives no salary or other bonus from Sports Direct.

Sports Direct, which has over 600 sports stores in Europe, including 400 in the UK, grew rapidly during the economic downturn on demand for its value offers, supported by a mixture of acquisitions, expanding online sales and the demise of rivals like JJB Sports.

The failed bonus scheme in April was the third attempt by Sports Direct’s board to reward its founder in recent years. One previous proposal was knocked back by shareholders due to concerns over the related performance targets, and another failed to be put to a vote.

Under the new plan, the scheme would grant up to 25 million ordinary shares in the company to eligible employees, including executive directors, amounting to around 4.2 percent of the issued share capital of the company.

The earnings targets run from 2016 to 2019. If the targets are met, 25 percent of any award would vest following the announcement of company results in July 2019, and the rest would vest in 2021.

Reporting by Kate Holton, Editing by Erica Billingham

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