Boss of discount chain B&M handed huge pay rise after floating company on London Stock Exchange
The boss of discount chain B&M has been handed a huge pay rise after floating the company on the London Stock Exchange.
Chief executive Simon Arora, who bought the bargain-basement bazaar now known as the ‘new Woolworths’ a decade ago, will earn a basic salary of £575,000 this year.
That is four times higher than the basic pay of £144,000 he earned last year, which was topped up with perks worth £22,248.
It is a stark contrast with the financial circumstances of B&M shoppers and its low-paid staff, many of whom are on a tight budget.
The increase emerged in the company’s annual report and accounts. But mystery surrounds the pay and perks of chairman Sir Terry Leahy, the former chief executive of Tesco who joined B&M in December 2012 ahead of its float last year.
The report said Leahy ‘does not receive any fees’ from B&M, which has its tax domicile in the tax haven of Luxembourg.
Instead, he is a senior adviser to US investor Clayton Dubilier & Rice (CD&R), which is based in the Cayman Islands, another tax haven. It is a major shareholder in B&M, which was founded in Blackpool in 1978 and bought by the Arora family in 2004 when it had just 21 discount stores and a turnover of £65m.
CD&R bought a 60 per cent stake in the company for £380m ahead of last year’s float. Shares priced at 270p each, resulting in a £1bn payday for the Arora family and CD&R.
The shares closed down 5.3p last night at 345.7p, valuing the discount chain at £3.4bn.
B&M last month reported a 29.5 per cent rise in annual revenues to £1.6bn after like-for-like sales at its stores rose 4.4 per cent. Profits jumped by 55.7 per cent to £135m.
The company opened 52 new stores in the UK last year and now has more than 400 on high streets as well as out of town. It is planning to open a further 60 stores this year.
Arora went to Manchester Grammar School, studied law at Cambridge and headed to the City where he cut his teeth at McKinsey, Barclays and 3i.
