Mike Ashley currently receives no salary or bonus from Sports Direct, the firm he founded in 1982, even though he still owns 62% of the company.
The board of Sports Direct said that as Ashley had received ‘no remuneration for his substantial contribution to the company since its initial public offering in February 2007,’ he should be granted 8 million shares, worth around £65m at its current share price of 835p.
A previous proposal to reward Ashley was scrapped in 2012 after shareholders protested prior to the annual general meeting, and another failed to be put to a vote.
Sports Direct said that since then the company's market value had increased, from under £2bn to £5bn, but that Ashley had received no reward for his part in the company's performance.
The company’s largest institutional shareholder, Odey Asset Management, has confirmed that it intends to vote in favour of the proposal at the meeting on April 4, Sports Direct chairman Keith Hellawell said in a statement.
‘The Board believes that Mike is one of the outstanding retailers of his generation and that all shareholders benefit from his on-going commitment to Sports Direct,’ he added.
Ashley’s share award is conditional on Sports Direct achieving full-year earnings of £330m in 2014 and £410m in 2015. This target is tougher than those set for the firm's employee bonus scheme, which requires Sports Direct to hit earnings of £310m and £360m for 2014 and 2015 respectively.
Shares in Sports Direct have risen almost 90% in the last year to 835p. The FTSE 100 firm, which has 400 stores in the UK and another 200 in Europe, grew rapidly during the recession after undercutting many of its high street rivals such as JJB Sports.