SORRELL LETS WPP SHAREHOLDERS VOTE ON HIS DEAL

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LONDON-WPP Group Chief Executive Martin Sorrell could give Maurice Saatchi a few pointers on getting along with shareholders.

This month, Mr. Sorrell will write to his shareholders inviting them to vote on his lucrative new stock-option package at an extraordinary general meeting to be held in late February or early March.

But there won't likely be a shareholder rebellion over Mr. Sorrell's generous share option scheme like the one that unseated Mr. Saatchi in December.

"I think it's different," said David Forster, an analyst at Smith New Court in London. WPP's "price performance has been superior [to Saatchi's]. Their return on capital is superior. The criteria on which the option package is based is different as well."

Mr. Saatchi's proposed package as chairman entitled him to collect $7.5 million if the company's share price doubled in three years. (Late last week, Saatchi stock was 53/4 on the New York Stock Exchange.) The figure is high largely because it was based on Mr. Saatchi's previous annual salary of nearly $1 million rather than the $300,000 salary he agreed to last year, a detail that further aroused shareholder ire.

The full details of Mr. Sorrell's stock plan aren't known. But to fully cash in on his stock options, WPP's share price must triple over the next five years.

In addition, WPP stock must significantly outperform the rest of the stock market.

Further setting it apart from Mr. Saatchi's plan, Mr. Sorrell's calls for co-investment, requiring him to put $2 million of his own money into the stock option scheme.

"It's not just cash in his back pocket," said a financial expert familiar with the plan.

"WPP hasn't been an outstanding investment over the last five years, but it hasn't been the unmitigated disaster that Saatchi has been," Mr. Forster said.

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