JD Sports will pay its former boss Peter Cowgill £5.5m over three years, in addition to a yearly salary worth more than £906,000 and a potential bonus worth up to £450,000 to prevent him from setting up rival retailers.
Under the agreement, Cowgill is prohibited from working for or advising any competitor of JD Sports for a period of two years or hiring any employee of the group.
In addition, he has agreed to advise its new chairman Andy Higginson and CEO Régis Schultz for an “expected period” of three years.
The sports and casual clothing retailer said Higginson and Schultz would receive Cowgill’s continued support and assistance “as they transition into their new roles”.
Higginson said: “I am delighted that we have been able to reach this friendly and constructive way forward with Peter, covering the next three years. Peter has accumulated invaluable experience over 18 years and we do not want to lose it, both Régis and I have It was a pleasure to benefit from his talent and advice.
“By any measure, this ends Peter’s extraordinary period in executive leadership, where he has been a central part of the company’s incredible success story to date.
“Now that the roles of chairman and CEO have been separated, a new CEO with a strong international and digital track record has been hired, and Peter’s knowledge and experience are locked in, JD.com is in a position to stay in a period of continued commercialization. Vantage excels on a foundation of strong corporate governance.”
The multi-million pound golden farewell is JD.com’s latest payment to Cowgill, who has cashed out a £50m stake in the company over the past two years.
The 69-year-old unexpectedly stepped down on May 25, just months after the competition watchdog fined the retailer more than £4m for a secret meeting with the boss of takeover target Foot Asylum.
Last year, JD Sports also suffered from shareholder dissatisfaction over pay, as Cowgill received almost £6m in bonuses despite the company receiving more than £100m in government support.
Before that, the company dropped a bid for department store chain Debenhams, but it was only after the sports retailer’s value evaporated into millions of pounds that details of a possible deal emerged. Just a few months ago, JD Sports controversially put its Go Outdoors subsidiary under management, then bought it back and gave up its expensive lease.
Cowgill has been the group’s outspoken chairman since 2004 and became its chief executive in 2014. It is understood he left after trying to thwart the board’s efforts to split the two roles and bring in young blood.
His exit was a major blow to the company, which has seen his fortunes turn around since he returned as chairman in 2001 after stepping down as chief financial officer for three years.
Under his leadership, the group expanded internationally, built a successful online business and joined the FTSE 100 after acquiring a range of brands including Sprinter, Go Outdoors and Fishing Republic.