Concerns are growing that the dispute between shareholders and ITV’s management designate could flare up again over the the terms of Charles Allen’s pay contract with the newly merged company.
An influential group of institutional investors yesterday forced Carlton boss Michael Green to relinquish his role as chairman of the ITV company that will result from the £4.2 billion merger of Carlton and Granada (see
Green Relinquishes Role As ITV Chairman Designate).
Now a senior institutional investor is warning that Allen’s undisclosed pay package with the newly merged company could turn into a new flashpoint in the battle between shareholders and senior executives at ITV.
According to The Times, the unnamed senior investor said: “The feeling here is that Michael Green has earned his respect by going. But Granada has got a lot out of this and one little issue is the package of Charles Allen.”
Allen will become chief executive of ITV plc when the merger of Carlton and Granada is completed early next year. Details of his pay deal are due to be released within a month and he could receive a payoff of nearly £2 million if he leaves Granada.
Meanwhile, the fledgling ITV plc is understood to be facing a boardroom crisis after Carlton directors expressed their dissatisfaction at the forced resignation of Michael Green as chairman designate (see Carlton Defies Shareholders Over Calls To Oust Green).
Three Carlton non-executive directors due to join the board of the newly merged ITV are believed to be considering their positions after giving in to pressure from a group of institutional shareholders led by Andrew Bolton at Fidelity.
The nomination committee responsible for finding an independent non-executive chairman to replace Green will be run by the non-executive Carlton and Granada directors allocated seats on the ITV plc board.
City bookmakers have named corporate financier John Nelson as a front runner for the merged ITV company’s chairmanship. Other potential candidates tipped by the Cantor Index include Patricia Hodgson, outgoing chairman of the ITC; Michael Grade, one time chief executive of Channel 4; and David Elstein, the former Channel Five chief executive that has been garnering support for several months.
Green looks set to be replaced by an interim non-executive chairman. Sir Brian Pitman, a senior non-executive director at Carlton, has been named as a potential candidate, but it is unlikely that he will take up the position on a permanent basis.
