The compensation of €18.8 million ($25.4 million) received by the former CEO of Nokia, Stephen Elop, for the sale of the mobile division to Microsoft, outraged the public opinion in Finland, according to the Financial Times.
“It is really appalling. Most definitely, people are angry. Of course it has a negative impact on how this deal is seen,” said Timo Soini, head of the True Finns political party, ranked second in popularity polls. The mayor of the city of Oulu, where Nokia has many employees, Matti Pennanen, find it difficult to understand such a high compensation: “In Finnish behaviour, such huge bonuses are unacceptable. It is very difficult to understand the amount. It should be asked of the board, ‘How is it possible’?”
The huge compensation, equivalent to approximately €1 million per €1 billion in lost market capitalization for Nokia under Elop’s tenure, was disclosed Thursday in documents relating to the agreement with Microsoft. Elop, a former Microsoft executive who will return to the giant software maker under the agreement, will receive €4.1 million euros in salary and bonuses and another €14.6 million euros in stock awards. Microsoft will bear 70 percent of the total compensation and Nokia will cover the difference.
The compensation is an extra to the other €9 million already received from the Finnish group by Elop, in the three years of leading the company. The size of Elop’s gains has outraged not only politicians but also Nokia employees, many of whom, like Elop, will be transferred to Microsoft. For some, the compensation is just fueling the conspiracy theory that Elop came to Nokia to prepare the sale of the mobile division to Microsoft.
Stephen Elop, 49 years old, a Canadian citizen, came to Nokia in 2010, after having spent most of his career at Microsoft where he advanced to the position of Vice President. He stepped aside as President and CEO of Nokia after the acquisition of the most important asset of the Finnish company by Microsoft.
Elop returns now to the U.S. company, as one of the main potential successors to CEO Steve Ballmer, who recently announced his resignation within 12 months. The transaction, worth €5.4 billion, would be completed in the first quarter of next year, after getting the necessary approvals from the shareholders of Nokia and from authorities.
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