Yell boss in £25m flotation windfall

THE chief executive of Yell, John Condron, is in line for a £25m shares bonanza when the former Yellow Pages group is floated in July. Finance director John Davis will get shares worth only slightly less.

The size of the payouts is likely to provoke an outcry. Many shareholders in BT thought the company was short-changed when it sold the group last year to two American venture capital firms for £2.1bn.

Hicks, Muse Tate and Apax Partners are expected to have doubled their money when the shares are listed, though it is understood that they will retain most of their equity stake and swap £600m of bonds into shares.

New shares worth about £750m will be issued and most of the money raised will be used to cut debt to near £1.2bn. Yell's executives and employees will share about £150m. Group advisers defended the payments this weekend.

'Condron and Davis will receive shares equivalent to up to 2% of the company, while all staff will share a total of 6% to 7%,' a source close to the company said. 'But it should be remembered that Condron has been with the company for 20 years and really is responsible for building the business.'

Strategy director Paul Fry, marketing chief Steve Chambers and new media marketing boss Eddie Cheng are other top bosses who will get big windfalls. The group is now recruiting non-executive directors.

Stephen Grabiner, ex-ITV Digital chief and an executive with Apax Partners, is one, while Lord Powell of Bayswater will be an independent director. As Charles Powell, he was formerly Margaret Thatcher's chief aide. His brother Jonathan is an aide to Tony Blair.