Davis bags £5m from Reed deal

REED investors will not be best pleased that chief executive Crispin Davis has just made £5m from exercising share options, ahead of the pay row expected at its annual meeting today.

Davis was granted 'nil-cost options' (the chance to get free shares) in September 1999 when he joined from advertiser Aegis. Reed said these were compensation for leaving behind his Aegis option package. He got options over 535,332 shares in Reed Elsevier and 319,250 shares in Dutch arm Reed Elsevier NV.

A Stock Exchange announcement revealed that Davis has just exercised the options. He gets the shares free. He has sold some already to pay an income tax bill.

Reed is already under fire for an executive option plan that could net Davis up to £8m. The National Association of Pension Funds has criticised the package as excessive. It had urged shareholders to vote against Reed's pay policy today but backed down slightly after Reed agreed to include new performance criteria. The NAPF now urges shareholders to abstain.