RE: Rebel! Rebel! Says the Times.5 Nov 2022 21:12
Mike Lynch, the technology entrepreneur battling extradition to the US on fraud charges, and his wife have launched a surprise rebellion over executive pay at Darktrace, the cybersecurity company that he helped found.
Almost 21 per cent of voting shareholders opposed Darktrace’s remuneration report at its annual shareholder meeting this week. More than 70 per cent of the votes against were from three shareholders, including Lynch and his wife, Angela Bacares.
Darktrace has appeared to distance itself from him in the wake of his legal problems. Lynch, 57, faces extradition to the US after he lost a long-running fraud case this year. He was accused of inflating the value of Autonomy, another technology company that he founded, before it was sold to Hewlett-Packard in 2011. He stepped down from the Darktrace board in 2018 and from its science and technology advisory council this year, but he and his wife are still major shareholders, with a combined stake of 12.1 per cent worth about £300 million in the £2.5 billion group.
In an interview last week, Poppy Gustafsson, chief executive of Darktrace, said: “Nine years ago he was a founding investor, but that has passed and we are a standalone business . . . He doesn’t get involved, I don’t see him.”
Gustafsson, 40, was paid a total of £12 million in Darktrace’s last financial year, including £10.7 million in long-term share awards linked to the company’s float in London in April last year. Cathy Graham, 62, chief financial officer, was paid almost £9 million, including £8 million in share awards.
Darktrace, based in Cambridge, uses artificial intelligence to detect cyberattacks and vulnerabilities in computer systems. Its directors and advisers include Lord Willetts and Amber Rudd, former ministers, and Lord Evans of Weardale, an ex-MI5 director-general.
Shares in the company rallied strongly last year after the float, before falling back, and fell sharply in September after Thoma Bravo, the US private equity firm, walked away from a potential takeover bid. However, the stock remains above the 250p float price, and closed up 6¼p, or 1.8 per cent, at almost 349p yesterday.
Darktrace is understood to have met shareholders including Lynch before Thursday’s annual meeting in London, where he is thought to have discussed the company’s growth share plan, which was behind the bumper pay award. Darktrace said its remuneration committee had written to major shareholders before the meeting “explaining the decisions made by the committee during the year and how it intended to operate the remuneration policy for the year ahead”.
It added: “The remuneration committee chair offered to hold meetings and calls with shareholders. The remuneration committee was comfortable that overall those shareholders that the remuneration committee engaged with were supportive of the Darktrace remuneration arrangements. The remuneration committee will seek to engage with those shareholders who did not support
Sign In
Follow the stocks
