As of Friday, Robert Marcus has been the chief executive of Time Warner Cable for 80 calendar days. If Comcast’s acquisition of the media giant goes through, Mr. Marcus stands to gain a $79.9 million dollar “golden parachute.”
Marcus assumed the role of CEO on Jan. 1, after previously serving as president and chief operating officer. He negotiated the massive deal, which would combine the nation’s two largest cable providers, less than two months after stepping into the position. The compensatory package represents a near eight-fold increase over his $10.1 million salary as chief operating officer, Bloomberg reports.
In total, Time Warner plans to dole out $135 million in parachutes to executives: Chief Financial Officer Arthur Minson could get $27.1 million, Chief Technology Officer Michael LaJoie is looking at a $16.3 million package and Chief Operating Officer Philip Meeks stands to gain $11.7 million, as outlined in a regulatory filing.
The size of these exit packages isn't unprecedented, but they are “rare and troubling,” Columbia Law School professor Robert Jackson told The New York Times. “There’s something stunning about such big paydays for such a small amount of work.”
Last year, a dozen executive received parachutes valued a more than $100 million each, Bloomberg Businessweek reports.
Shareholders will have a chance to weigh in on these packages, under the Dodd-Frank financial reform bill of 2010, though such votes are nonbinding.
“If Time Warner Cable shareholders are sufficiently outraged, they can vote against it, and if executives are sufficiently embarrassed, it might discourage other CEOs from doing the same thing,” Mr. Jackson told the Times. “But I’m not optimistic.”
In 2013, there were 141 such votes on executive compensation packages associated with company takeovers; 86 percent of them passed, according to figures from FactSet Shark Watch reported by the Wall Street Journal.
Of course, there is no guarantee that the $45 billion buyout will actually go through.
The deal will first have to pass through federal regulatory reviews conducted by the Justice Department and the Federal Communications Commission. Several states are considering joining the DOJ review. The Senate Judiciary Committee plans to hold hearing on the merger in April. The regulatory review process is expected to take about a year.
“This merger is unprecedented,” Seth Bloom, a former general counsel of the Senate Antitrust Subcommittee and current president of Bloom Strategic Counsel told the Monitor. “There has never been a cable merger of this size – we’re talking here about the No. 1 and No. 2 cable companies in the US.”