The bingo and casino giant Rank Group faces a major shareholder revolt over boardroom pay next month, despite its chief executive taking a steep salary cut during the first phase of the coronavirus pandemic.
Sky News has learnt that a number of large institutional investors in Rank, which owns the Mecca and Grosvenor brands, are planning to stage a protest over the company's remuneration report and future pay policy at its annual general meeting.
City sources said on Thursday that Rank had been 'red-topped' by the Investment Association's IVIS service - the strongest-possible alert to shareholders that they should consider opposing the company's proposals.
Institutional Shareholder Services (ISS), an influential voting advisory firm, has also recommended voting against Rank's board, which wants to hand big share windfalls to top executives a year earlier than previously promised.
According to ISS, the company also wants to amend the terms on which it can award shares to executives under a long-term incentive scheme set up in 2018.
"Expanded discretion under the proposed remuneration policy allows for amendments to be made to the outstanding block award, suggesting potential adjustments in light of disruption from COVID-19, though the company has committed to engaging with major shareholders prior to exercising this discretion.
"Overall, shareholder support is not considered warranted," ISS said.
Any revolt by institutional shareholders will be diluted by the fact that Rank is majority-owned by a single Malaysian shareholder.
Nevertheless, a big protest would be embarrassing for Rank after it furloughed thousands of its employees as a result of the COVID-19 crisis.
On Thursday, Rank announced that it was selling its casino business in Belgium for £25m.
A Rank spokesman declined to comment.
