Robinson exit to cost New York Times over $15 million
Wed Dec 21, 2011 5:59pm EST
By Peter Lauria
(Reuters) - Janet Robinson, who will step down as chief executive of the New York Times Co on December 31, will receive an exit package in excess of $15 million, according to people familiar with the situation.
In addition to a $4.5 million consulting fee, the Times Co will pay Robinson $10.9 million in pension benefits that she accrued over 28 years of service, they said.
According to a regulatory filing, Times Co's policy previously stipulated that Robinson, 61, would not be eligible for full pension benefits until she was 63 and had been with the company for 30 years. But people familiar with the matter said the Times Co agreed to pay out the full amount as part of her separation agreement.
A Times Co representative declined to give any more details on Robinson's departure beyond the statement issued last Thursday, and did not make her available for comment.
Taken together, Robinson is walking away with just under $15 million exclusive of the value of the stock options she accumulated over her tenure with the company. The details of her severance agreement, which would also include her base salary, performance bonus, and stock options, are expected to be disclosed in the Times Co's 10K regulatory filing in March.
News of Robinson's severance agreement comes during the same week that a wave of buyouts hit the newsroom of the flagship New York Times and the company disclosed that it was in talks to sell 16 regional newspapers to Halifax Media Holdings. More than a dozen newsroom staffers reportedly took buyouts, among them well-known bylines including sports writer George Vecsey, metro columnist Clyde Haberman, and business reporter Diana Henriques.
Against the backdrop of an 80 percent decline in the Times Co's stock over her seven-year tenure as CEO, the size of Robinson's exit package prompted some criticism in the newsroom. Times Co shares are down 25 percent this year alone.
But Robinson is getting less than half of the $37.1 million in severance Craig Dubow received when he retired as Gannett Inc's CEO in October, after six years at the helm of the newspaper publisher and amid similarly dismal financial results.
FRICTION WITH SULZBERGER
While the Times Co has not given an official reason for Robinson's sudden decision to retire, people familiar with the matter said it was not related to an impending financial event such as a big decline in advertising sales or digital subscriptions or a large quarterly loss.
Some newsroom staffers believe that Robinson's efforts to "raise her profile" were interpreted by Arthur Sulzberger Jr, the family scion and company chairman, as an unwelcome power grab. They say that Robinson pushed for a larger publicity effort around the business side after seeing the attention heaped on the newspaper when Jill Abramson took over as editor-in-chief.
Robinson embarked on an outreach effort that included speaking engagements at recent UBS and Goldman Sachs media conferences, hosting lunches for investors and analysts at the company's Lorenzo Piano-designed headquarters, and conducting editorial meetings with Thomson Reuters, Bloomberg and others.
The aim of these meetings was to tell the story of how the Times Co's business has recovered since 2008, highlighting its quick repayment of a $250 million loan from Mexican billionaire Carlos Slim, its sale of noncore assets, and its successful implementation of a digital paywall, among other things.
"She wanted to convince investors to come back to us; that we had turned the corner so they should buy the stock again - that was the objective," said one source.
Though Robinson and Sulzberger had worked cordially and efficiently together as CEO and chairman, sources said friction has been building between the two recently for reasons ranging from their differing management styles to how Wall Street interpreted their respective roles to Sulzberger wanting a leader with more digital acumen.
Whether Robinson's PR efforts represented the breaking point for Sulzberger is unclear, however.
"Arthur is the operating head of the company, he makes the final decisions," said longtime Times Co-watcher Alex Jones, author of "The Trust" about the company. "Janet wouldn't be out doing anything without his blessing."
(Reporting By Peter Lauria in New York; additional reporting by Paul Thomasch; Editing by Tiffany Wu and Matthew Lewis)