Playtech Shareholders Revolt over CEO’s Proposed Bonus

Earlier this month, the leading gaming company Playtech revealed it was preparing a new bonus scheme, which would get the firm’s CEO Mor Weizer a hefty Christmas present worth £30 million. (around CAN$51m)

Playtech also announced the proposal would be discussed at a board meeting later during December, but it looks like there could be problems, as shareholders have publicly expressed their revolt over Weizer’s bonus.

Playtech Shareholders Revolt over CEO’s Proposed Bonus

It Remains to Be See If the Policy Will Be Approved

Weizer has been appointed as Playtech’s Chief Executive Officer back in 2007, and the bonus scheme was planned as an incentive award for the company’s boss.

At one point, it did look like this was a done deal, especially as major investors gave their support for the new bonus policy. However, two of the company’s shareholders are on the verge of rejecting this plan.

We should get all the answers from a recent shareholder meeting, which was scheduled to take place on December 19. If the company’s investors indeed green-light this proposal, Mr. Weizer can get up to £30.4 million in stock, provided share price is met.

The proposal also includes a nil cost option award, worth nearly 2 million shares, which are to be paid out in tranches. Of course, this will happen only if Playtech’s stock price stays on a certain level for a period of one month.

According to the proposal, the first tranche is to be paid out if shares go up to 600p. The second one will go through if the shares jump even higher, to 700p, while the third one if the price exceeds 800p. The bonus – which is capped at £16 per share – will be awarded if the company’s shares stay above 800p for a minimum of 30 days. Playtech’s shares soared past £10 more than 2 years ago, but have since dropped significantly, mostly on profit warnings issues. 

Advisory Firms Say: “Reject the Scheme”

Institutional shareholders, such as Odey Asset Management and Paulson & Co, have already stated they will give their support to the proposed policy. However, advisory firms Institutional Shareholders Services and Glass Lewis have since issued a statement urging other shareholders to say no to the proposal.

But this is not the first time that Playtech investors have rebelled over Weizer’s pay. Earlier this year, they revolted over the remuneration package.

Back in May, around 41.8% of Playtech’s shareholders didn’t give their support to the firm’s remuneration report, while 40.9% voted against the proposed remuneration policy. It should be noted that only 40.6% of the investors approved the presented bonus scheme.

Explaining its decision, Institutional Shareholder Services explained it wouldn’t give its support to the board’s remuneration policy. On the other hand, Royal London Asset Management, which has a 0.5% stake in the gaming giants, stated it was against the proposed scheme, as the share price targets it included were below the values from July 2018.

Only last month, Playtech announced its struggling TradeTech division would have a significant impact on the company’s full-year results.