Bridgepoint: Norman conquest must yield plunder for minorities too


What price independence? A good £ 1.75 million if you happen to be Archie Norman, UK problem solver. Norman takes the brunt of Bridgepoint shares for his role as senior independent director at the newly listed private equity group, according to a recent filing.

The connection fee, taxed and converted into shares, is already worth £ 1.25 million on paper after tax. This will be supplemented by an annual grant of £ 200,000.

The thing for the defense: premium stocks before the stock market are not an unusual way to catch up with big names. If you have a skin in the game, it matches the interest of shareholders. This is doubly important in private equity, where directors of the listed company can also be in individual funds.

Their interests are more entangled with the performance of these funds, which divide the interest borne, than with fees. For example, it can encourage the asset between funds – such as Bridgepoint done in 2019 with its stake in MotoGP owner Dorna Sports. Some businesses even allow independent directors to put money into underlying funds.

If the concept is defensible, the quantum is not. Norman would have had just as much skin in the game if he had put in his own money, or would have matched Bridgepoint’s big part-for-part. Richard Burrows, chairman of Pepco, for example, agreed to buy his 137,000 shares in the owner of Poundland, thus aligning his interests without taking any value in the process.

Bridgepoint is numb, of course. But a big “golden hello” harms at least the independence of the optical level.

It also seems unnecessary. Norman’s chairman’s allowance is £ 200,000 a year for this part-time job. This is about a third among the £ 240,000 plus £ 70,000 shares belonging to the chairman of 3i, a listed UK buyout company that is much larger. According to calculations by Willis Towers Watson, this is also half of the median salary paid to full-time chief financial officer.

Bridgepoint’s bet is that Norman is worth a much bigger package. The duty now rests on both to prove the case by presenting growth better than that of 3i.

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