BT chief's bonus of £1.5m for taking firm to the

 brink



 By Michael Harrison, Business Editor



 11 May 2001



 Sir Peter Bonfield, the chief

 executive of British

 Telecom, stands to collect a

 bonus of £1.5m if he pulls off

 the biggest corporate rescue

 Britain has ever seen.



 Details of the huge

 incentive package offered to

 the embattled BT boss

 emerged yesterday as the

 debt-laden group unveiled

 plans to raise £6bn from

 shareholders and spin off its

 mobile phone business to

 stave off financial crisis.



 BT is also scrapping

 dividend payments to its

 army of 1.7 million small

 investors, many of whom have held their shares

 since privatisation in 1984.



 Sir Peter will be eligible for a bonus equivalent to

 1.75 times his basic salary when his contract ends in

 December, 2002 provided he has completed the

 restructuring successfully. His base salary was

 increased to £820,000 from April.



 The record-breaking £6bn rights issue is among a

 package of measures designed to slice £15bn from

 BT's £29bn debt mountain. Other measures include

 the demerging of BT Wireless, which includes

 Britain's number two mobile operator, BT Cellnet,

 by the end of year, the sale of BT's Yell directories

 business, and a further 5,000 job losses from the

 131,000-strong workforce.