Sri Lankan-born CEO to get $11.1m in one-time payouts

A Sri Lankan-born Chief Executive Officer (CEO) of a US-based global diagnostic device and service provider is expected to receive about $11.1 million in one-time payouts, according to media reports. 

The top executives at Waltham-based Alere (NYSE: ALR) will get around $24 million worth of one-time cash and equity awards if the company is sold Abbott Laboratories, the Boston Business Journal reported.

According to change-in-control agreements in effect since October 2014, five of Alere’s top executive officers will be eligible for the payments as well as extended benefits if they leave the company as a result of it being acquired.

This week, Illinois-based Abbott (NYSE: ABT) offered to pay about $5.8 billion plus the assumption of $2.6 billion of debt. The deal was announced earlier this week. The companies have not provided a timeline for the deal to close other than to say it has been approved by both companies’ boards. The buyout still needs approval of Alere shareholders and U.S. regulators. The offer price of $56 per share represents a 50 percent premium to Alere’s share price just prior to the deal’s announcement.

CEO Namal Nawana, who took over as CEO when Alere founder and former CEO Ron Zwanzger resigned in 2014, would receive about $11.1 million in one-time payouts, according to financial filings. 

That includes a continuation of his salary for 18 months, totaling $1.3 million; a $201,000 cash award; the acceleration of vesting of what the company then estimated to be $7.9 million in restricted stock and options; and another $1.65 million in gross-up payments to help cover his tax hit form the change-in-control payout.

Nawana also holds 81,000 shares of company stock worth around $4.5 million, according to Bloomberg.

Nawana has been with the company since 2012, originally as chief operating officer. His assumption of the CEO role came after a months-long battle between the company’s former management and one of its investors, Coppersmith Capital, which had been advocating for the company to sell off less profitable parts of the business and align itself for a sale.

Four other officers — CFO David Teitel, and Daniella Cramp, Sanjay Malkani and Avi Pelossof, the heads of Alere’s cardiometabolic, toxicology and infectious disease units — also stand to receive change-in-control payments and benefits valued between $2.3 million and $3.6 million.

Born in Sri Lanka, Nawana grew up in Australia and then went to Europe in the early 1990s to develop medical diagnostics as a scientist. From there, his career took him around the world, and he especially got to know the Indian and Asian markets for tests.

Source: Boston Business Journal

-Agencies