LONDON -- Sir Terry Leahy, the CEO of Tesco PLC, is in line for a potential 9 million ($17.7 million U.S.) share bonus under a scheme designed to reward him for developing the retailer's international business, including the new Fresh & Easy Neighborhood Stores on the U.S. West Coast, reported The Financial Times.
Leahy earned 4.62 million ($9.12 million U.S.) in cash and shares last year, up 16% on the previous year. He stands to ratchet up his earnings even further under several enhanced bonus plans to be approved by shareholders at the group's [image-nocss] annual meeting next month, the newspaper said.
The New Business Incentive Plan, which will apply only to Leahy, hands him up to 2.5 million shares. They will gradually vest between 2011 and 2014 if targets for the expansion of Tesco in the United States and elsewhere are met.
Sir Terry is also in line to receive an additional 50% of his salary in shares linked to the performance of the American business, on top of an existing potential share bonus of 100% of his salary and cash bonus of 100% of his salary.
There is a potential bonus of up to 50% of salary for Tim Mason, CEO of the American unit, the report added.
Fresh & Easy is due to open in the United States this year. The group is believed to be planning up to 500 U.S. stores over three years and will invest 250 million ($493.6 million U.S.) to launch the new business. In Tesco's new annual report, the company's remuneration committee said that it had reviewed the pay arrangements in the light of the strengthening of returns in the international business and the creation of significant new business in the U.S.
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