(Alliance News) - Galliford Try Holdings PLC on Tuesday backed its directors' remuneration report, which drew opposition from a sizeable chunk of the construction firm's investors at its November annual general meeting.
The resolution was passed after being approved by just over 64% of votes, and Galliford explained on Tuesday that the opposition from more than 35% of its investors was due to a bonus given to Finance Director Andrew Duxbury.
Duxbury joined Galliford in March 2012 and become group finance director seven years later.
"The board understands that shareholders' concern was the finance director's 2019/20 annual bonus where 50% was based on the successful completion of the disposal of the group's housebuilding divisions in January 2020," Galliford added.
"Whilst appreciating the view of many shareholders that 'transaction-focused' measures should not be regularly included in executive director incentives, the remuneration committee's decision to base half of the finance director's 2019/2020 annual bonus on the successful completion of the disposal reflected that this transformational corporate transaction represented a significant focus of the finance director's duties and responsibilities."
The company in November 2019 agreed to sell its Linden Homes and Partnerships & Regeneration to Bovis Homes PLC, the FTSE 250 housebuilder now renamed Vistry Group PLC.
The deal's terms saw Vistry issue 63.8 million new shares to Galliford, valued at GBP675 million, pay GBP300 million in cash, and take over Galliford's GBP100 million 10-year private debt placement.
Galliford added on Tuesday: "In making the award in respect of the disposal, the remuneration committee carefully considered the one-off nature of the transaction in the context of the finance director's wider contribution and the underlying performance of the group. This decision was permitted under the remit of the remuneration committee and the company's remuneration policy.
"The board will continue to engage with shareholders to ensure their views are fully understood and considered and can be taken into account by the committee in the future."
Galliford Try shares were up 1.9% at 127.36 pence Tuesday afternoon in London.
By Eric Cunha; ericcunha@alliancenews.com
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