Marissa Mayer to Make $186 Million From Verizon Deal -- Update

By Deepa Seetharaman Features Dow Jones Newswires

Yahoo Inc. Chief Executive Marissa Mayer is set to reap some $187 million from her shareholdings as a result of the internet company's sale of its core business to Verizon Communications Inc., according to securities filings.

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The hefty payout comes despite Ms. Mayer's inability to accomplish what she was hired to do five years ago: revitalize the fading internet icon after its struggles with high employee and executive turnover and declines in ad revenue.

Instead, Yahoo sold its business -- not including some assets such as its stakes in other internet companies -- to Verizon last year for $4.5 billion. That deal is expected to close in June, after months of delays following Yahoo's disclosure of two massive security breaches.

Yahoo shareholders will vote on the deal during a special meeting on June 8, according to a securities filing published Monday. The measure is expected to pass. As part of their severance package, Ms. Mayer and other top Yahoo executives are eligible for accelerated vesting of all stock options, restricted-stock units, and other equity-based awards outstanding when the deal closes, according to the filing.

For Ms. Mayer, that includes stock options valued at more than $85 million and Yahoo shares valued at nearly $77 million at Tuesday's closing share price of $48.40, according to the information in the filing.

She also holds restricted stock units worth about $25 million at Tuesday's closing share price; vesting of those units would be accelerated under her golden parachute plan, Yahoo has said.

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Together, those amounts are worth $187 million at Tuesday's closing share price. Adding salary, bonus and options she has already exercised, that brings her total compensation over her tenure at Yahoo to an estimated $227.6 million.

The payout figure is far larger than the golden parachute of $23 million Yahoo said last month that Ms. Mayer would receive as part of her planned departure from what's left of the company after the sale to Verizon. That figure included a $20 million estimate of the value of restricted stock units, as well as $3.02 million in cash.

Supporters and critics alike say Ms. Mayer took on a steep challenge with Yahoo, but her managerial mistakes, including not cutting costs quickly enough, complicated the already tricky turnaround.

Verizon initially agreed in July to buy Yahoo's business for $4.83 billion. Then Yahoo disclosed two large security breaches, one in 2014 that hit more than 500 million accounts and another in 2013 that affected more than one billion accounts.

The security incidents forced Yahoo back to the negotiating table, and the two companies said in February they had agreed to knock $350 million off the price.

In March, Yahoo's board said Ms. Mayer wouldn't receive her 2016 cash bonus or 2017 equity awards after a board investigation found that she and other senior executives failed to "properly comprehend or investigate" the 2014 breach.

Last month, U.S. officials indicted four Russians, including two Russian spies, in the 2014 hack.

Write to Deepa Seetharaman at Deepa.Seetharaman@wsj.com

(END) Dow Jones Newswires

April 25, 2017 19:40 ET (23:40 GMT)