Stephen Elop’s Contract With Nokia Rewarded His Failure

Tero Kuittinen, writing for Forbes:

This adjustment meant that unlike previous CEOs, Elop was facing an instant, massive windfall should the following sequence happen to take place:

  • Nokia’s share price drops steeply as the company drifts close to cash flow crisis under Elop.
  • Elop sells the company’s handset unit to Microsoft under pressure to raise cash.
  • The share price rebounds sharply, though remains far below where it was when Elop joined the company.

Should this unlikely chain of events ever occur, Elop would be entitled to an accelerated, $25M payoff. Through some strange coincidence, that very sequence of events actually did happen to take place between 2011-2013. Practically instantly after Elop was handed his contract.

★ Tuesday, 24 September 2013