The boss of the company that owns the London stock market will become one of Footsie’s highest-paid chief executives despite the crisis the stock market is going through.
Some 89 per cent of London Stock Exchange Group (LSEG) shareholders voted in favor of more than doubling David Schwimmer’s maximum package from £6.25m to £13m.
The deal, called “excessive” by critics, was approved despite growing concerns about the health of the stock market amid a “relentless” wave of acquisitions.
A £7m rise for Schwimmer was approved on the same day Australian mining giant BHP made a shock £31bn bid for London-listed Anglo American.
Any deal would see Anglo drop out of the FTSE 100, following BHP’s decision to move its main listing to Sydney in 2021.
‘Excessive’: Some 89% of London Stock Exchange Group shareholders voted in favor of more than doubling David Schwimmer’s maximum package from £6.25m to £13m
Dan Coatsworth, analyst at AJ Bell, said “it is crisis time” for the London Stock Exchange (LSE), which is “struggling to preserve the integrity of the UK market”.
He added: ‘It’s ironic that shareholders voted to double chief executive David Schwimmer’s top salary just hours after we had the second FTSE 100 takeover proposal this year.
“It needs to find a way to replenish the pool of companies in the London market if the acquisition machine goes into overdrive.”
Shareholder advisory firm Glass Lewis had urged investors to oppose the increase, saying it was “excessive.”
LSEG owns the LSE, but its data and analytics division now accounts for around 70 per cent of the business’s revenue.
However, there are concerns that while the overall business has grown since Schwimmer took over in 2018, the stock market is contracting.
Other recent major deals include Nationwide’s £2.9bn acquisition of Virgin Money and Barratt’s £2.5bn bid for smaller builder Redrow.
And there has been speculation that America’s Nasdaq stock exchange business is even looking to take over London’s Aim junior market, which is owned by LSEG.
Andrew Monk, head of stockbroker VSA Capital, said selling it “would be crazy for LSEG.”
‘Why would you sell to a competitor? Then they would come and have lunch. Nasdaq would love to be in London and park its bus outside the LSE.
Schwimmer’s pay rise comes amid debate over whether British chief executives are underpaid compared to their American counterparts.
Julia Hoggett, who heads LSEG’s securities division, warned last year that lower executive pay was making it harder for UK companies to attract top talent.