Paris, 18th of July, 2012
Proxinvest received a letter from the Vivendi CEO about our recent comment on the departure’s conditions of Jean Bernard Lévy and which we publish as requested.
We had called as “coquette”, or “cozy”, in a news of July 5, 2012 the departure benefits offered to former CEO of Vivendi and of its subsidiary SFR, Jean Bernard Levy, 57, recently dismissed.
The new CEO, Jean-Francois Dubos, wrote courteously to Proxinvest July 13, supporting that our July 5 article contained “errors and inaccurate statements”. We have wanted to review them very precisely hereunder.
Our calculation of the full “departing gifts” adding to a total amount of € 10 million for Jean Bernard Levy was not disputed:
• six months of base compensation plus one month per year of seniority in the Group beginning in 2002, i.e. 16 months of the last fixed and variable compensation or € 3,888,000.
• the benefit of all its stock options and performance shares, subject to the achievement of performance conditions relating to them. This benefit is estimated by Proxinvest to € 3.4 million.
• the maintenance of the additive pension scheme: the annuity to be paid by additive Vivendi in addition to other complementary systems was estimated by Proxinvest at € 218 232 a year. The cost of this item to Vivendi is estimated by Proxinvest by more than € 3.5 million.
Vivendi blames us for seeing some inconsistencies between these payments and the AFEP MEDEF code, as it is a “forced departure”. In fact, the AFEP MEDEF Code , in Recommendation 20.2.4. “Severance payments”, recalls that “it is unacceptable for Managing Directors whose businesses are in a situation of failure or who themselves are failing to leave with compensation. “
And this Code further states” These performance conditions set by the Board must be demanding and not permit the recovery of an officer in the event of a forced departure due to a change of control or strategy. “
We did, in Proxinvest, not see neither very demanding performance conditions nor very clear change of strategy, and above all, in clear disagreement with President Jean-Francois Dubos, reminding the that the 2011 recovery in earnings, we maintain the subjective opinion, that there was “state of failure” since Vivendi shareholders have lost 30% of value since early 2007.
On the maintained pension plan, however, we acknowledge to President Jean-Francois Dubos a minor inaccuracy of Proxinvest who wrote that Jean-Bernard Levy will also benefits “of a hat-retirement pension fully paid by Vivendi while it has not reached the retirement age, and with the number of stock options and restricted stock in violation of AFEP-MEDEF code” .
“Forgive us, dear Mr. President, JBL will certainly benefit “in all cases” of his additive pension plan if he is crazy enough to take an employee job until his employee date of formal retirement, instead of getting paid by advisory fees… Only in case of such new salaried job, Vivendi actually would save the cost of hat pension payment!
Did finally Vivendi as states President Dubos, “scrupulously respected” the Code which states clearly: “The payment supplementary pension benefits is subject to the condition that the beneficiary be a Director or employee of the company when he asserts his pension rights under the rules in force. “
So please tell us, dear Mr. President Dubos, where hide our other errors or inaccurate information?
