Capellas faces cuts to £24m WorldCom pay package
New WorldCom chief executive Michael Capellas could be forced to lower his £24m pay demands as the company's bankruptcy monitor dismissed his original contract.
Richard Breeden, appointed by the bankruptcy court to keep a tap on the bankrupt telecommunications group, yesterday told the court judge Capellas’ package was ‘grossly excessive’.
Capellas joined WorldCom last month, leaving computer company Hewlett-Packard where the dust of its recent merger had barely settled.
Should WorldCom emerge from bankruptcy, Capellas stand to receive £11.5m in shares, £5m in share options and a £7.6 non-guaranteed award. In subsequent years he would receive a performance-based stock award of twice his £1m annual salary plus his target bonus.
Following resistance from Breeden, WorldCom is revising Capellas’ pay package agreements.