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Misys chief executive could be in line for £1.7m payoff

Mike Lawrie’s bumper departure package comes despite widespread condemnation of last year’s £2m bonus payout

Mike Lawrie, the chief executive of Misys, whose £2m bonus payout was condemned last year as “wholly excessive”, could be in line for a further £1.7m when he leaves the company this year.

The banking software group confirmed to the stock exchange on Wednesday that it had “mutually agreed” with Lawrie that he would depart in March.

The news comes after Tuesday’s announcement that Misys had reached an “agreement in principle” to merge with its Swiss rival Temenos. The proposed deal will see Guy Dubois, the Temenos chief executive, take the helm of the enlarged group.

Misys declined to comment on Lawrie’s payoff, and a spokesman said she could only refer people to the company’s annual report, which states: “In the event of a change of control, if the contract is terminated either directly or indirectly as a result within the following 12-month period, [Lawrie] will be entitled to receive a sum equal to 12 months’ salary, on-target bonus, pension contribution and health insurance.”

That implies that Lawrie, who is American and is paid in dollars, can receive about .7m (£1.7m), made up of .1m in salary, a .3m bonus, plus about 0,000 in benefits and pension contributions.

It is not clear if Lawrie’s departure is due to him being sidelined for the top job, but last year he agreed to a new deal “to incentivise [him] to remain with the company”, according to the report. In employment contracts, a change of control clause entitles the employee to a “specified payment or enhanced notice period if their employer is taken over and the takeover results in dismissal by their employer or a material reduction in the employee’s responsibilities leading to constructive dismissal”.

Lawrie was awarded a £2m bonus last year, which caused huge controversy in the City. The payout required the share price to beat its 208p starting level from five years earlier, which it did easily when it closed the period at 291.8p. But to receive the payout the shares also needed to trade at more than 400p for 20 consecutive days, which they achieved only once and that was linked to bid talks that subsequently collapsed. The scheme was described by the shareholder advisory group Pirc as “wholly excessive”.

On Tuesday, Misys and Temenos said they had agreed on several key terms on a possible all-share merger that could create one of the world’s largest standalone financial software companies. Under the agreement, 4.1 Misys shares would be exchanged for each Temenos share, leaving Misys shareholders with 53.9% of the combined group and Temenos shareholders with 46.1%.

Apart from Dubois being named as the future chief executive, Temenos chairman Andreas Andreades was announced as the new chairman, while Misys finance director Stephen Wilson will keep his role at the enlarged group. © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds