Marissa Mayer Falls From Grace on Yahoo! Inc. Golden Parachute (YHOO)

The dollar amount seems outrageous to most observers. Yahoo! Inc. (NASDAQ:YHOO) CEO Marissa Mayer — who isn’t expected to stay on after Verizon Communications Inc. (NYSE:VZ) completes its acquisition early next year — is expected to receive a severance package on the order of $44 million once she goes.

Marissa Mayer Falls From Grace on YHOO Golden Parachute

That’s $44 million despite the fact that she essentially failed to do for Yahoo what YHOO shareholders were expecting her to do.

Too big of a golden parachute, all things considered?

There’s no denying the dollar figure stirs up a debate on the matter, but amazingly enough (and not necessarily in a good way), the parting gift Mayer stands to receive is much lower than some were awarded in the recent past.

It’s also much bigger than some other severance packages received by CEOs who arguably did their job much better than Mayer did hers.

Mayer’s Golden Parachute Isn’t Abnormal

Just for the record, that $44 million golden parachute wouldn’t be an all-cash offer. The bulk of it would be in the form of exercised stock options. The award would only fork over about $3 million in raw cash.

Considering the average college grad only makes about $2 million over the course of his or her lifetime, is that sum ridiculous? Not as much as some other juicy financial packages handed over to departing CEOs in recent history.

Remember former General Electric Company (NYSE:GE) CEO Jack Welch? He walked away with $417 million worth of compensation just for stepping down back in 2000. Granted, he led the company for 20 years, and grew it significantly to the benefit of shareholders. Still, $417 million is a ton of money.

The figure isn’t even challenged by the $85 million former Viacom chief Tom Freston pocketed when he was booted in 2006. Add about $23 million to that figure for things like stock and a retirement fund payout. Then again, he only held the job for nine months. In terms of compensation relative to the time of service rendered, it’s arguably the sweetest deal ever concocted.

It’s also one that will forever spur the question “what if?”

Although, not the official reason, a key factor in Freston’s exit was his failure to acquire MySpace; News Corp (NASDAQ:NWSA) nabbed it for $580 million.

In retrospect, it may have been a brilliant decision on the part of Freston. News Corp ended up taking a huge loss on MySpace, selling it for $35 million just a few years later when Facebook Inc (NASDAQ:FB) surpassed it. Yet, one can’t help but wonder what MySpace might have become in someone else’s hands. Perhaps Facebook would have never gotten out of the gate.

Not every gold parachute is a painfully generous deal, however.

Take the severance package Apache Corporation (NYSE:APA) would offer its CEO John Christmann were he to be forced out. It’s only $8.4 million.

Granted, the loss-making company arguably can’t afford to offer anything extra to any employee, working or fired. By most corporate America standards, though, that’s chump change.

Former Valeant Pharmaceuticals Intl Inc (NYSE:VRX) CEO Michael Pearson wasn’t exactly lavished when he stepped down earlier this year either. His deal was only worth about $12 million. Of course, he also left Valeant Pharmaceuticals under the scrutinizing microscope of the federal government, and with a marred public opinion … not that others haven’t done worse, yet collected more.

There Is No “Normal”

Yes, $44 million seems high in light of what Marissa Mayer didn’t accomplish as the head of Yahoo. The figure seems even more unjust knowing she also collected more than $160 million worth of pay during her four years as CEO. But, it’s not an unusual deal for the folks who make it to the top of the corporate food chain.

More than anything, the size of a golden parachute is mostly a reflection of how well a CEO negotiated before signing a contract, which — like sports — is a matter of star power as much as it’s a matter of capability.

Mayer had an average amount of star power and negotiating skills. It’s the shareholder tolerance for such deals that have gotten out of whack.

As of this writing, James Brumley did not hold a position in any of the aforementioned securities.

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