Heinz chief's $55m golden parachute
Heinz chief executive Bill Johnson could receive more than $US200 million ($205 million) should he exit after Warren Buffett’s Berkshire Hathaway and Jorge Paulo Lemann’s 3G Capital buy the tomato sauce and baked beans maker.
Mr Johnson would get ‘‘Golden Parachute Compensation’’ including $US56 million ($55 million) in cash, equity, bonuses and other benefits, the company said in a regulatory filing. Other shares under Mr Johnson’s control are worth almost $US100 million, while his vested deferred compensation account totals $US57 million.
Mr Johnson, who became Heinz’s sixth CEO in 1998, has made about 40 acquisitions, helping expand the company into emerging markets. He streamlined the brand portfolio, boosted spending on marketing and ratcheted up innovation, including Dip & Squeeze ketchup packs.
Heinz boosted sales to $US11.7 billion in fiscal 2012, a gain of 8.8 per cent from the year before.
‘‘The payments reflect Mr Johnson’s success in creating billions of dollars in shareholder value over his successful 15- year tenure as President and CEO,’’ Michael Mullen, a Heinz spokesman, said. ‘‘This compensation consists of equity that Mr Johnson accumulated over his 30-year career with Heinz and existing equity awards and contractual rights that were in place well before the announcement of the proposed merger.’’
Berkshire and 3G will pay $US72.50 a share for Heinz, about 20 per cent more than the $US60.48 closing price February 13, before the deal was announced. The company’s existing debt will be rolled over, valuing the transaction at $28 billion, according to a previous statement.
Mr Johnson’s total compensation in the fiscal year ended in March was $US16.2 million, including $US1.3 million of salary.
After announcing the deal February 14, Mr Buffett told CNBC he hoped Mr Johnson would remain CEO. In a conference call after the deal was announced, Mr Johnson said he was ‘‘way too young’’ to retire.
Still, Mr Buffett told CNBC that 3G has the final say.