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Tesco dough no

Sat, 2010-07-03

The Sun

TESCO is planning peace talks with fuming shareholders after a stunning revolt over the pay deals for the supermarket's top execs yesterday.

More than 47 PER CENT of investors either voted against or refused to back Tesco's pay policy at the company's annual general meeting in London.

It is a record rebuke for the high street giant and comes despite bumper profits and dividends in the past year.

Chairman David Reid told the AGM: "Clearly some shareholders in the last few days have shown concerns about aspects of our approach to remuneration."

He added: "We always listen carefully to our shareholders and will consider the details of their concerns."

Chief executive Sir Terry Leahy bagged £5.2million in pay and bonuses in 2009 as well as hundreds of thousands of cheap shares.

But investors were also upset that deputy chief Tim Mason got £4.3million despite heavy losses in the US - where he is rolling out Tesco's Fresh & Easy chain.

One private shareholder at the AGM said: "In the dictionary a bonus is defined as an extra dividend paid out of surplus profit."

Sir Terry told Sun City that Tesco would meet again with investors to discuss their grievances. But he insisted the "broad conditions" of the pay structure were right. He added: "It seems to be the way it is now. A number of companies have had large votes against them."

But influential shareholder group PIRC said the vote result was a "significant rebuke" for the firm.