Massive payout for Gucci executives
It has emerged that executives at Gucci could net over $390 million in share options following the conclusion of a deal with France's Pinault-Printemps-Redoute (PPR), which won its long-running battle with Moet-Hennessy for control of the company. According to a report in the UK Financial Times, the main beneficiaries will be creative director Tom Ford, who could receive $150 million and chief executive Domenico De Sole who could gain $75 million. The figures make the two executives the highest paid in Europe.
Bernard Arnault, chairman of minority shareholder LVMH, decribed the payments as "monstrously disproportionate", but Gucci defended the use of share options as incentives for executives and said the method by which the numbers were calculated were "transparent and fair". Since Gucci went public in 1995 the Florentine fashion house has seen annual growth of over 25% per annum and is now worth more than $8 billion.
A deal for control of Gucci was finally concluded in September, 2001 after more than two years of legal wrangling between PPR and Moet-Hennessy. The end result is that Gucci’s minority shareholders have been offered $101.5 per share at the future date of March 2004. Gucci has also announced the payment of a special dividend of $7 per ordinary share for all its shareholders with the exception of PPR, between December 12 and 14.
