JD Sports Fashion Plc will pay former boss Peter Cowgill at least £5.5 million ($6.3 million) as part of an exit deal after he was ousted in May amid concerns over the company’s governance practices, including a meeting he held in a parking lot with the head of a rival company.
As part of the accord Cowgill is prevented from working or advising any competitors to the British sports chain and he cannot solicit any of its employees, according to a statement Wednesday. He will also be kept on as a consultant to support chair Andy Higginson and CEO Regis Schultz.
Cowgill will be paid £3.5 million over two years for the first measure and £2 million over three years for the second. He is also receiving his salary, benefit and bonus up to his departure in May. The company said it would honour “his contractual notice period” of 12 months.
JD Sports’ shares were little changed in early trading.
Cowgill played a key role in the rise of JD Sports and built it into the leading sportswear and sneaker chain in Britain. The company endured some difficult months when he was ousted as it sped up a process to split the chairman and CEO roles.
Cowgill’s departure followed a series of regulatory issues for the brand where it was found to have broken competition law by fixing the prices of certain clothing items.
It was also separately fined nearly £5 million by Britain’s antitrust regulator for sharing commercially sensitive information and breaching an order relating to its proposed merger with smaller rival Footasylum Plc. The Competition and Markets Authority said Cowgill had met Footasylum boss Barry Bown twice while it was investigating the merger, including once in a parking lot.
“I am pleased that we have been able to reach this amicable and constructive way forward with Peter covering the next three years,” Higginson said Wednesday. “Peter has hugely valuable experience built over 18 years which we do not want to lose and both Regis and I are delighted to be able to benefit from his considerable talent and advice.”
By Katie Linsell
JD Sports Fashion said the French businessman and former B&Q executive Regis Schultz would become its chief executive officer, filling the top position after eight years.