CEO Stephen Elop to Nokia: I'm getting a divorce, so I need all of the $25 million
Nokia's board chair Siilasmaa claimed on Friday that Nokia's American CEO wasn't getting a deal the Finnish ones wouldn't given the circumstances. It turns out, however, that Mr Elop actually got an US-style contract, with "accelerated vesting" of his share options if "change of control" occurs, and a nice golden parachute to land him if someone buys the company or a part of it - all normal for the CEO-heavy US business climate, but an abomination abroad.
a working place accident” for not noticing it earlier.Thus, if the CEO managed to cheapen the company's shares and someone scooped it up, he or she would have walked with the aforementioned many millions, and this has been in Elop's contract from the beginning. Yesterday the board chair admitted the discrepancy and said Nokia’s legal team had “
Long story short, that's exactly what happened with Nokia in the span of just three years, confirming once again that whichever company has had similar dealings with Microsoft usually ends up on the losing side, and, just like a few analysts were warning, this might have been Ballmer's plan all along. Heck, the company paid more for Skype than it did for Nokia, after all - $7.5 billion is a far cry from the $19 billion bandied about when the first reports that Microsoft will acquire Nokia's smartphone division surfaced.
Also, it seems that Nokia's favorite blogger Eldar Murtazin was right all along when he reported that the heads of Microsoft and Nokia are meeting in Las Vegas around last year's CES expo to decide on the buyout. He also informed that the Siilasmaa will be named board chair then, which might explain why Nokia's legal department had the "accident" of not noticing all the fine details in Elop's contract.
As for CEO Stephen Elop, the Finnish newspaper that came up with the investigation, cites unnamed sources that confirm the board asked him to reconsider his golden parachute package of $25 million, in light of all the negative press pouring on the deal because of that. He, however, said that he's in the process of getting a divorce, and his wife's lawyers wouldn't let him turn down a cent of the package. Sounds like a plan - moreover, 70% of that compensation will come from the new owner Microsoft, so resistance seems futile.