Novartis Won’t Pay Outgoing Chairman $78M

by Christopher Freeburn | February 19, 2013 9:26 am

Novartis Won’t Pay Outgoing Chairman $78M

money stacks hundreds 630 300x227 Novartis Wont Pay Outgoing Chairman $78M[1]After an outcry from shareholders and Swiss politicians, Novartis (NYSE:NVS[2]) has abandoned plans to give its chairman Daniel Vasella a $78 million non-compete deal when he steps down this month[3].

Word of the remarkably flush golden parachute prompted sharp criticism from the Free Democrats, a traditionally pro-business Swiss political party, and the Swiss Bishop’s Conference, as well as leading government ministers, the Associated Press noted.

Under the six-year deal, Vasella, who has served as the pharmaceutical giant’s chairman for more than a decade, would have received as much as 12 million francs each year. The company said that the non-compete deal was designed to prevent rivals from poaching Vasella to exploit his intimate knowledge of the company.

In a statement, Vasella conceded that the public found the¬†compensation package¬†“unreasonably high,” but noted that he had planned to give much of it to charity. Vasella announced plans to step down last month[4].

Shares of Novartis rose fractionally in pre-market trading on Tuesday.

Endnotes:
  1. [Image]: http://investorplace.com/wp-content/uploads/2012/01/money-stacks-hundreds-630.jpg
  2. NVS: http://studio-5.financialcontent.com/investplace/quote?Symbol=NVS
  3. when he steps down this month: http://hosted.ap.org/dynamic/stories/E/EU_SWITZERLAND_NOVARTIS?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2013-02-19-04-34-48
  4. announced plans to step down last month: http://investorplace.com/2013/01/novartis-chairman-steps-down-shares-jump/

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