(Image Source: Nabors Industries)

BY CHARESSE JAMES

ANCHOR ZACH TOOMBS

Talk about a severance package: Nabors (Nay Bores) Industries’ Eugene Isenberg is stepping down as CEO and taking $100 million with him.

The oil and gas drilling firm announced Isenberg’s retirement Monday, and news of his payout is raising questions in the business world. The main one: Why so much? MSNBC tries to figure that out.

“Nabors says its says its’s just a result of this change in responsibility, the problem is that it’s also higher than the company’s third quarter net income, which was just over $74 million. And what about the stock? Down 19 percent this year. That would make him, by my calculations; the highest paid but also the – in terms of shareholder value – one of the worst performing U.S. execs.

Fox Business gives more details…

“A clause in Isenberg’s contract called for the $100 million payout in the event of his death or disability, or under various termination scenarios, including ‘constructive termination without cause.’ The amount was scaled back in 2009 after shareholders complained about a much-larger exit deal.”

Isenberg is being replaced by Nabors current president Anthony Petrello after 25 years as the company’s CEO. But Isenberg will maintain relations with the company as Chairman of Nabors’ board of directors.

A writer for Bloomberg says the not-so-parting of the ways, in addition to such an unusually high payout, will most likely ruffle a few feathers.


“Corporate governance activists are sure to sputter about Isenberg’s windfall. He attracted attention in 2009 for having collected more than $625 million in bonuses during more than 2 decades at the helm of Nabors. Corporate Library, an executive-pay monitoring service, in 2009 branded Isenberg one of America’s five most overpaid bosses.”

Despite Nabors’ decreasing share value over the past five years, the company is defending Isenberg’s severance package, telling MSNBC’s The Bottom Line...

“...under Isenberg’s leadership the company emerged from bankruptcy in 1987 with 38 rigs and negative shareholder equity of $35 million and grew to a multinational with operations in 24 countries and shareholder equity of more than $5.6 billion.”

Excessive or not, senior oil analyst  Brian Uhlmer tells CNN it’s too late to change it now, no matter how unreasonable it may seem.

“The man obviously doesn’t need the money and he’s already been compensated for all of the work that he’s done there...This is an unnecessary expense in my mind, but there’s no way around it. The board was not going to be able to push him out of the position without the payment.”