BT boss quits with £1.5m pay-off

BT chief executive Sir Peter Bonfield is to leave the company early, aided by an instant pay-off of almost £1.5m. He will also be entitled to performance-related share and bonus schemes over the next three years, worth £1.3m at today's price. A year's extra pension money, £350,000, will be paid into his retirement pot.

The decision to leave follows a torrid couple of years, during which time BT's share price has plummeted from a high of 1358p to a low of 305p. The shares rose 8p to 345p.

'It's been a helluva ride and I've really enjoyed it,' said Bonfield.

He will leave BT at the end of January 2002, six years after joining from computer company ICL. A search for his successor has now begun. Those close to the company believe chairman Sir Christopher Bland will appoint an external candidate although several internal directors are thought to be interested. BT said later that finance director Philip Hampton and BT Retail chief executive Pierre Danon had ruled themselves out of the running.

Bonfield's announcement comes six months after Bland replaced the much-criticised Sir Iain Vallance. At the time of Bland's appointment, a new contract was put in place for Bonfield, offering him a bonus of £820,000 if he stayed until the end of 2002. 'We've achieved a lot and made decisions quicker than we thought then' said Bonfield.

Since Bland's arrival in May, BT has launched a £5.9bn rights issue; sold its directories business Yell for £2bn; disposed of Japanese and Spanish assets for £4.8bn; effected the demerger of its mobile phones arm mmO2 and agreed the unwinding of its Concert joint venture with US telecoms operator AT&T. Bland said: 'In May, I wouldn't have foreseen that the Concert unwinding could have been achieved so quickly.

'We also decided not to separate the wholesale business from the retail business and that would have taken a long time. Given the acceleration of Concert and the decision on the retail division, it makes sense for both of us to start the search for Peter's successor now.'

Bonfield and Vallance both came under fire from shareholders for spending vast amounts on extravagant overseas expansion plans. Last May, BT scrapped its dividend and delivered a £1bn loss.

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