Technology is big business these days, with company revenues stretching into the billions for some lucky organisations, and these large companies need experienced leaders, those to guide them through troubled times and bring success. But what happens when a change of leader is the best option? Terminating contracts can be costly, and it certainly proved so for the following five companies…
Edward Whitacre, AT&T – $230m
Former CEO Whitacre collected $230m when he stepped down in 2007, having overseen AT&T’s rise from regional services provider to national powerhouse, all despite never apparently using a computer or e-mail whilst at the company. He was not one to rest on his laurels, however, going on to take up further board positions at ExxonMobil and General Motors, winning special praise for his revitalising of the latter.
Louis Gerstner, IBM – $189m
Credited with being the man who turned around IBM’s fortunes, having overseen the closure of its retail desktop PC business in the face of overwhelming competition, Gerstner received a payoff of $189m when he left computing giant IBM in 2002. He continued as Chairman of the company for several months before taking up a post at notorious equity firm The Carlyle Group.
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Tom Freston, Viacom – $85m
A veteran of the music and entertainment industries, Freston received a bumper payoff in September 2006 when he was fired by company chairman Sumner Redstone. His unexpected sacking was supposedly due to the fact that he had not moved quickly enough to buy MySpace, the most popular social networking site of the time, which was instead snapped up by Rupert Mourdoch’s News International. Freston’s payoff included $58.9 million in pay, $5.7 million in retirement fund payout and $9.8 million in stock.
Various, Hewlett-Packard – $83m
If you’re a company executive looking for a lucrative payoff, then HP may well be your best bet, as in the last 12 years the company has paid out a large amount to several CEOs. First off was CEO Carly Fiorina, who received $21m in cash and stocks following her sacking in 2005. Next was her successor, Mark Hurd, who received $37m in cash and stocks in 2010 following his five years in charge. Finally, his successor, Leo Apotheker, (pictured above) received $7.2 million in cash, plus $18 million in stock when he stepped down in September 2011 following a share price plunge.
Henrique de Castro, Yahoo – $58m
De Castro left Yahoo in January after only 15 months as the company’s COO. Hired from Google by Yahoo CEO Marissa Mayer, de Castro was one of the company’s highest-paid employees, with his pay estimated at being around $39m per annum. The size of his payout was probably linked to a $20 million one-time payment to compensate him for Google bonuses he forfeited when he changed companies.
