Coke and investor spar over 2014 compensation plan

Thu Apr 3, 2014 7:48pm EDT
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By Lisa Baertlein

LOS ANGELES (Reuters) - Wintergreen Advisers, which says it owns more than 2.5 million shares of Coca-Cola Co KO.N on behalf of clients, on Thursday intensified its critique of the proposed 2014 equity compensation plan of the world's biggest soda maker.

David Winters, the chief executive officer of Wintergreen, outlined his concerns with the compensation plan late last month in letters to Coca-Cola's directors and investors, including Warren Buffett, CEO of Berkshire Hathaway Inc BRKa.N, which is Coca-Cola's largest shareholder.

In those letters, Winters characterized the plan as "an unnecessarily large transfer of wealth from Coca-Cola's shareholders to members of the company's management team."

He is urging the company's board to yank the plan and replace it with a different one.

On Thursday, Winters took his argument to CNBC, saying that the company's stock-buyback program aimed at improving investor returns "has been hijacked by the company."

Coca-Cola said on Thursday that the proposed equity compensation plan is not just for senior management. About 6,400 employees participate in the plan globally.

Winters "continues to overstate the dilutive impact of the plan," Coca-Cola said in an emailed statement.

The skirmish comes after Coca-Cola reported 2013 volume and revenue that fell short of internal expectations. U.S. soda sales fell for the ninth straight year in 2013.   Continued...

A woman walks past a Coca-Cola truck truck at a distribution center in Alexandria, Virginia October 16, 2012. REUTERS/Kevin Lamarque