Pfizer's McKinnell - The $200 Million Dollar Man
Talk about holiday cheer! Former Pfizer CEO Hank McKinnell is walking away from the drugmaker $200 million richer. This despite investor anger about his rich retirement benefits. CNBC'S Mike Huckman has the lowdown on McKinnell's millions.
Pfizer fired McKinnell as CEO last July and stripped him of his chairmanship 2 months earlier than expected this week. But according to this SEC filing posted on the web after the market close yesterday, McKinnell is none the worse for the wear.
The company he worked at for nearly 4 decades and ran for about 5 years says it won't see revenue growth until at least 2009. (It's cutting billions of dollars in costs, letting thousands of employees go - and that was before the loss of a key developmental drug earlier this month, so it could even get worse.) But Hank McKinnell will be sitting pretty. Pfizer shares fell about 40% on McKinnell's watch. They've risen about 3 bucks since around the time he was ousted.
Pfizer says McKinnell is getting an $82 million pension. (He can get one big fat check or draw a whole bunch of relatively smaller ones over several years.) He has $78 million in deferred compensation coming to him. That's money he earned but let ride for example in Pfizer stock.
And then McKinnell will get another $39 million in severance bonuses and other cash and stock including compensation for vacation time he did not use. The total value of his additional time on the clock - more than $300,000 for a grand total of $199 million.
In a research note to clients this morning Miller Tabak Healthcare Analyst Les Funtleyder figures the exit package works out to "A little over $2 million for every billion dollars in market cap lost during his tenure."
He says "Though this will receive some media attention, we view this as more annoying than material."
A Pfizer spokesman says the company is fulfilling its legal obligation to honor the terms of McKinnell's contract which was signed in 2001 - what he called a "Different time in the company's history". He says he doesn't know if McKinnell has told Pfizer how he wants his money, whether he'll take it all at once or spread it out.