Richard Glynn will be given £2.4m worth of shares after Ladbroke’s share price hit £2 and stayed above £2 for 30 days.
A spokesman confirmed Glynn secured the bonus shares earlier this month but that he “only gets the shares physically after they are calculated in July”.
The £2.4m in shares are in addition to Glynn’s basic salary of £580,000, “annual bonus” of £491,000 and £978,000 in “performance shares”.
If the shares continue their recent run the £2.4m bonus could mature into a £12m jackpot. Under Ladbrokes’ controversial “long-term incentive” bonus plan, Glynn will collect £12m if the shares hit £2.97 by 2015.
The shares hit a five-year high of £2.45 and have risen by 17p over the last two days after Ladbrokes secured a deal with online gambling software provider Playtech.
The company said the “Ladbrokes growth plan”, introduced in April 2010, was designed to “incentivise key senior executives to support revitalisation of the business”.
Christopher Rodrigues, chair of Ladbrokes’ remuneration committee, said: “If the company does well, so will shareholders – and so, rightly, and proportionately, will management.”
Ladbrokes staff are sharing out a £5.5m bonus, with retail staff also getting a 2.7% average pay rise.
Glynn’s big rival in the betting industry, the William Hill chief executive, Ralph Topping, was paid £1.9m last year.
So far it looks as if the company’s plan to get the shareholders motivated has worked out well. This incentive has already proven to be quite lucrative. In fact, if the shareholders continue to see results such as these and Ladbrokes continues to as well; then it may not be a big surprise to see others following suit and offering this same type of incentive to their staff and implementing plans of a similar structure. It makes sense to motivate in a manner that works well for everyone, and this appears to be a good example of just how to do that.