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Shareholders condemn Severs' £1.6m bonus

Shareholders rapped the knuckles of Severfield-Rowen’s board today when they said a £1.6 million bonus to former managing director John Severs should not have been paid.

Mr Severs was handed the one-off payment last June when he retired after spending 30 years at the group.

But shareholders of the country’s only quoted steelwork contractor condemned the decision by refusing to pass the resolution at today’s AGM.

Mr Severs will not have to pay the money back but in a statement Severfield-Rowen said: “The company, and in particular the Remuneration Committee, will pay due and appropriate cognisance to the sentiments behind the shareholders’ decision.”

The 54-year-old cut his day-to-day ties with the company he helped co-found and was replaced by current chief executive Tom Haughey.

Mr Severs also acts as a senior advisor to the company which will net him £750,000 when his three year role runs out in July 2010.

At the AGM, the company defended the decision to pay the bonus to Mr Severs – who now lives on the Isle of Man – and added: “It is worthy of note and regard that in the last five years that John Severs was managing director, the company achieved an increase in total shareholder returns, the barometer by which investors judge the success of a company and its management, of 800 per cent.”

Pre-tax profits at the group last year rose over 40 per cent to £42.9 million on revenue up £5 million to just over £300 million.