Kobil sets record with Sh707m CEO exit pay

The Nairobi Securities Exchange-listed #ticker:NSE firm disclosed Mr Segman’s final compensation in its latest annual report that has been published in line with the new reporting regulations requiring detailed account of money paid to individual directors.
The cash settlement took a big bite out of KenolKobil’s earnings in the year ended December 2017 when the company’s net profit stood at Sh2.46 billion, a two per cent rise from Sh2.41 billion the year before.
KenolKobil did not disclose what Mr Segman earned in salaries but his settlement is enough to pay his successor, David Ohana, for another 13 years based on his (Mr Ohana’s) annual salary of Sh52.9 million or Sh4.4 million a month .

Oil marketer KenolKobil #ticker:KENO paid its former chief executive, Jacob Segman, Sh707.1 million to settle a long-running dispute over his stock-based compensation, making it corporate Kenya’s largest single payout to an executive.

The Nairobi Securities Exchange-listed #ticker:NSE firm disclosed Mr Segman’s final compensation in its latest annual report that has been published in line with the new reporting regulations requiring detailed account of money paid to individual directors.

“A legal dispute arose on validity of the Esop [employee share ownership plan] options, with legal proceedings commencing in courts of law in Kenya and in the State of Delaware, USA. In December 2017, the company settled the matter out of court, making payment to Mr Segman possible,” the report says.

The sum is nine times the Sh77.1 million the oil marketer had earlier provided for in its books for Mr Segman’s compensation, but which was not disclosed as such.

KenolKobil’s other reports had previously suggested that the former executive walked away with sums ranging between Sh300 million and Sh480 million.

Mr Segman, a former group managing director who resigned in 2013, had been granted Esop option tranches between 2005 and 2010.

“The same vested at various dates between 2008 and 2013,” KenolKobil says in the report.

READ: Biwott-linked KenolKobil trades 25pc of its stock

The cash settlement took a big bite out of KenolKobil’s earnings in the year ended December 2017 when the company’s net profit stood at Sh2.46 billion, a two per cent rise from Sh2.41 billion the year before.

KenolKobil did not disclose what Mr Segman earned in salaries but his settlement is enough to pay his successor, David Ohana, for another 13 years based on his (Mr Ohana’s) annual salary of Sh52.9 million or Sh4.4 million a month in the year ended December 2017.

Mr Ohana was also paid a bonus of Sh84.7 million and other payments for undisclosed items amounting Sh13.4 million, raising his total remuneration to Sh151.1 million.

Settling Mr Segman’s claims reveals the heavy price the oil marketer has paid in the controversial Esop.

At Sh707.1 million, the settlement is equivalent to redeeming about 40.2 million shares or 2.7 per cent of the company’s 1.4 billion issued shares based on the current market price of Sh17.6.[ATTACH=full]168848[/ATTACH] https://www.businessdailyafrica.com/news/Kobil-sets-record-with-Sh707m-CEO-exit-pay/539546-4542152-view-asAMP-pyt0rk/index.html

Your name’s making me want to end this year asap!! I’m starving some of that fire and ice

Daaaaaamn, Unapo zuru wengine usiiiìiiiiinipite × 2

Therein lies your reason for the huge amount. In some companies over and above salaries top execs get performance based bonuses, where some companies opt to award stock options rather than cash.