The deterioration in the position of Delek Group Ltd. (TASE: DLEKG), controlled by Yitzhak Tshuva, has manifested itself in the new compensation policy for senior managers, published by the company as the previous policy, instituted three years ago, comes to an end. The new policy needs to be approved by Delek Group shareholders, who will meet for that purpose on February 1, 2021.
Under the new policy approved by the Delek Group board of directors, the ceilings for the annual bonuses paid to the CEO and senior VPs will be lowered, the salary ceiling for the board chairperson will also be lowered, as will the ceiling for stock-based compensation for senior company officers. For example, the ceiling for the annual bonus for Delek Group CEO Idan Wallace will be reduced by NIS 560,000, while the ceiling for the CEO's stock based compensation will be reduced by NIS 1.1 million. The monthly salary ceiling will remain at NIS 160,000.
Altogether, the maximum compensation package for the CEO will fall by NIS 1.6 million annually. Wallace has been CEO of Delek Group since January 1, 2020, so that the new policy will apply from his second year in the post.
Under his employment agreement, Wallace will receive salary, welfare payments, and other benefits, costing NIS 2.7 million. Together with a maximum bonus of NIS 1.4 million, he will be entitled to a total compensation package in 2021 costing up to NIS 4.1 million.
The monthly salary ceiling for executive chairperson Gabi Last (100% position) will be reduced from NIS 160,000 to NIS 130,000. In 2019, Last received a gross monthly salary of NIS 121,000, so that in practice the lowering of the ceiling will not affect his pay. The company says that, assuming payment of the maximum bonus, Last's compensation in 2021 will total NIS 2.9 million.
The monthly salary ceiling for senior VPs will be NIS 120,000. VPs whose positions are not defined as senior will receive monthly salaries of up to NIS 85,000. Under the proposed policy, there will be no updating of company officers' pay in 2021, and in 2022 and 2023, and update will be up to 10% for each of them.
In 2019, Delek Group reported administration and general expenses of NIS 51 million (parent company alone), which compares with NIS 44 million in 2018 and NIS 42 million in 2017. For the first nine months of 2020, this item was NIS 37, only 2.6% less than in the corresponding period of 2019. Under its agreements with its bondholders, the company is supposed to keep this item to up to NIS 51 million in 2020, and reduce it to NIS 45 million in 2021, NIS 40 million in 2022, and NIS 35 million form 2023 onwards.
Published by Globes, Israel business news - en.globes.co.il - on December 27, 2020
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