The incoming boss of the Sports Direct owner Frasers Group has been handed his biggest ever payout, netting a near-£21m consultancy fee as he prepares to take over from the founder, Mike Ashley, next month.
Michael Murray, the Frasers “head of elevation”, who is engaged to Ashley’s daughter Anna, is being handed a cash payment three times larger than any previous sum he has earned from Sports Direct. It is being made under a controversial agreement in which Murray is paid a consultancy fee based on value generated under property deals made for the company.
Murray’s MM Prop Consultancy Ltd is entitled to up to 25% of any value created by its services to Frasers, which also owns the House of Fraser department stores, the designer fashion chain Flannels, the gaming retailer and events group Game, Evans Cycles and Jack Wills.
The £20.9m payment handed to Murray for 2022 comes after a £2.5m sum in 2021 and £9.7m in payouts during 2019 and 2020. Those payouts were already far in excess of the £150,000 a year paid to Sports Direct’s previous senior executives, such as former CEO Dave Forsey.
The Doncaster-born son of a property developer, who began by helping Ashley with personal real estate deals a few years after meeting Anna on holiday in 2011, could also be handed shares worth more than £100m if he more than doubles its share price to £15 by 2025 under a new pay deal which comes into force from 1 May. The share price currently stands at £6.93.
Almost half of the independent shareholders in Frasers rejected the group’s plans for the £100m bonus scheme and more than half came out against a pay rise and bonus for the group’s finance director, Chris Wootton.
In an announcement to the stock market late on Friday, Frasers said the latest payout was being made after an assessment of the final terms of Murray’s consultancy deal before he moved to his new role. It said the assessment had been made “with the assistance of independent third-party experts”.
Frasers said the deal included a 40% discount agreed with Murray as part of the “finalisation and cessation” of the consultancy agreement.
The board of Frasers said: “The agreement with MM Prop Consultancy Ltd has delivered significant financial and strategic value for the group and its stakeholders. We are delighted that Michael will now drive us forward in our elevation journey, which we are already making strong progress with.”
Murray said: “I am very excited to be leading Frasers Group in its next chapter and am confident we are going to take the group to new heights with the progress we are making in our elevation strategy.”