£2.5m Cairn shares windfall pulled

By Graeme Evans
Published on Tuesday 24 January 2012 12:15

A £2.5 million shares windfall for the founder of Edinburgh-based oil explorer Cairn Energy was withdrawn by the company today amid shareholder pressure.

Sir Bill Gammell, the former Scottish international rugby player, was due to receive the options as reward for helping to bring about the company’s $5.5 billion (£3.5bn) sale of its Indian operations last year.

A week before shareholders were due to vote on the payment, Cairn said it had pulled the resolution in the wake of discussions with several institutions. It now plans further talks with shareholders.

The move comes a day after Business Secretary Vince Cable outlined plans to address the growing controversy over executive pay, including by offering shareholders a binding vote on remuneration policies.

Gammell founded the business in the early 1980s and was chief executive from the company’s stock market listing in 1988 until June last year, when he became non-executive chairman. He was awarded a knighthood in 2006 for services to industry in Scotland.

Explaining its decision to award the shares, Cairn told shareholders that Gammell was involved in “extensive and rigorous negotiation” to bring about the Indian sale to Vedanta Resources.

The disposal is due to generate a return to shareholders worth $3.5bn, which will still be the subject of a vote next Monday.

As part of the incentive scheme, Cairn also planned to make a £1m donation to charities nominated by Gammell. He is also entitled to receive £1.4m on stepping down as chief executive.

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carrottop

Wednesday, January 25, 2012 at 10:38 AM

Dont normally support bonus payments but shares in this company saved me and my family from real hard times, sorry I had to sell them but as I say life is a lot better for me because of Cairn energy and Bill Gammell. Good luck to them.

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