Frasers Group, the company that owns Sports Direct, has offered its incoming chief executive a £100m windfall if he manages to double the firm’s share price, the company has revealed.
The “challenging but achievable” target, which would see 31-year-old Michael Murray double the firm’s shares to £15 for 30 consecutive trading days before 7 October 2025, would land the current head of elevation £100m in shares on top of an annual salary of £1m.
Mr Murray is engaged to the daughter of billionaire Sports Direct founder Mike Ashley and will replace him as current Frasers chief executive in May.
Mr Ashley founded the chain in Maidenhead, Berkshire, in 1982 and has now grown his retail empire to be worth around £3bn and cover almost 1,000 stores.
The reshuffle, announced earlier this month, would see Mr Ashley stay on as executive director of the company.
A spokesperson for Frasers said: “The board believes that the significant increase in value of the shares to be achieved before Michael’s share option award vests is suitably challenging but achievable and would be evidence of the success of the group’s elevation strategy and Michael’s leading role in this.”
Mr Murray has been tasked with modernising the business and creating a more upmarket image, the company told the stock market earlier this month, announcing the reshuffle.
The Frasers spokesperson said: “The group’s elevation strategy is transforming the business and receiving positive feedback from consumers and our brand partners, especially on projects such as the new Oxford Street Sports Direct which opened in June 2021.”
They added: “The board consider it appropriate that Michael leads us forward on this increasingly successful elevation journey.”
Sports Direct’s profits dropped by 94.1 per cent to £8.5m during the pandemic as stores were forced to close nationwide throughout three national lockdowns. The company’s sales dropped by 10.7 per cent.
Last year, the sports retailer was forced to U-turn on a decision to keep factories and warehouses open throughout the first national lockdown. It emerged that full-time shop staff were expected to work in closed stores to receive their wages while part-time staff were out of work. PPE was not provided initially, sources said.
The firm’s lifestyle business, which includes House of Fraser and Flannels, saw better margins, with a sales growth of 1 per cent.
On Wednesday, before the details of Mr Murray’s bonus were announced, the group’s shares closed at £6.50.
Mr Murray’s pay package will be voted on by shareholders on 29 September.