Granada Boss to Sacrifice Payoff to Appease Investors?

28 October 2003

Charles Allen, chairman of British TV group Granada, is reportedly seeking to appease rebel shareholders by offering to change the terms of his contract.

Allen intends to become chief executive of ITV plc – the company to be formed by the merger of Granada with Carlton Communications. However, his future in that role has been questioned after investors in the two firms dramatically forced Carlton chairman Michael Green to abandon his plans to take the ITV chair [WAMN: 23-Oct-03].

Like Green, Allen has come under fire from many of the firms' shareholders. One of their gripes is his two-year rolling contract – which entitles him to twice his £1.01 million ($1.71m; €1.46m) annual salary if he is deposed – whereas the norm among similar UK media groups is one year. In March, around one-quarter of Granada's shareholders voted against the firm's executive pay policy [WAMN: 20-Mar-03].

Having seen how easily Green was forced out, Allen is now said to be ready to ditch the two-year payoff. Details of his new contract will be included in the documents sent to investors once the final merger terms are agreed.

• Separately, Sir Brian Pitman, the senior non-executive director at Carlton, has emerged as the favourite to take up the post of ITV chairman on an interim basis until a permanent replacement for Green is found.

Data sourced from: multiple sources; additional content by WARC staff