Melrose has seen nearly a quarter of its investors vote against a pay policy that will see top bosses net millions as part of a generous incentive plan.
A total of 22.87% of shareholders rejected the company's remuneration report at its annual general meeting on Thursday following a decision to award four bosses - Christopher Miller, David Roper, Simon Peckham and Geoffrey Martin - at least £42 million each in 2017.
The payouts, linked to Melrose's 2012 long-term incentive plan (LTIP), drew criticism from shareholder advisory group Glass Lewis, which urged investors to vote against them.
Melrose recently sealed a controversial £8 billion hostile takeover of engineering giant GKN.
Melrose chairman Mr Miller said before the AGM on that the firm will "consult with shareholders" over its remuneration policy.
"Given the recent acquisition of GKN, your board intends to review the existing Melrose remuneration arrangements and expects to consult with shareholders in the coming months," he said.
Glass Lewis said it had "severe reservations about supporting the remuneration report at this time ... all executives received what we consider to be excessive payouts under the plan".
It said: "As such, we are unable to recommend that shareholders support this proposal."
The pay row threatens to thrust Melrose back into the public eye just weeks after its fight to take over GKN, which drew union and political anger.
Its victory brought to a close a bitter battle that had raged since January, with unions and MPs warning over job cuts, asset stripping and national security concerns throughout the takeover saga.
Mr Miller said on Thursday: "We are very excited by what is in store for Melrose over the next few years.
"We look forward to working with the GKN employees to transform the prospects of the businesses through significant investment."