Linked by Thom Holwerda on Tue 24th Sep 2013 11:44 UTC
PDAs, Cellphones, Wireless

Finland is boiling with rage this weekend over the $25 M bonus payment the CEO Stephen Elop is set to receive as he leaves Nokia after his two-year tenure. Questions are now being raised by the oddest aspect of the bonus: the board of Nokia seems to have given Elop a $25 M incentive to sell the handset unit cheaply to Microsoft way back in in 2010. This effectively means that the board hired a man who was given a giant carrot to drive down Nokia's overall valuation and phone volumes while preparing a sale to Microsoft. What could possibly be a reason to structure Elop's original contract in this manner? Did the board in fact end up promising Elop more compensation in case he sells the phone division than if he runs it with modest success?

Vindication. We were right all along.

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RE: Comment by Nelson
by kwan_e on Tue 24th Sep 2013 13:12 UTC in reply to "Comment by Nelson"
Member since:

Considering his compensation is tied to stock options, lowballing the stock (which he hasn't done, or he would've sold it when it was less than $4 a share) wouldn't make sense financially for him.
CEOs have golden parachutes. Who knew. This simpleton view of how companies work is all too common here. I'm glad I ignored the endless piles of bullshit here and loaded up on Nokia stock while it was low, made a nice return.

But it was low enough for you to buy some...

There was no specific clause in his contract that said "Sell to Microsoft and get $25 million". It merely treats an acquisition the same as being let go from the company compensation wise, a much less serious offense.

So everything ever written is always written exactly as the intention?

lowballing the stock wouldn't make sense financially for him.
The Nokia board could've fired him Sept 4th and he'd still get $25 million.

Do you have short term memory loss within the time span of you writing a comment?

Market cap is a fickle thing, it was $14 billion prior to the announcement of the deal, its $20 billion now. Setting Nokia up on firm ground and leaving them with nothing but upside is the opposite of killing the company.

What was the market cap before Elop?

Reply Parent Score: 3

v RE[2]: Comment by Nelson
by Nelson on Tue 24th Sep 2013 13:49 in reply to "RE: Comment by Nelson"
RE[2]: Comment by Nelson
by tylerdurden on Tue 24th Sep 2013 16:51 in reply to "RE: Comment by Nelson"
tylerdurden Member since:

What was the market cap before Elop?

It was around 56ish Billion, now it's around 24ish Billion.

Reply Parent Score: 8