PARIS (Reuters) - European pharmaceuticals group Sanofi SASY.PA on Thursday said it had agreed to pay 4.44 million euros ($5.06 million) in total to ousted chief executive Chris Viehbacher.
Viehbacher, who left in October, will receive a payment of 2.96 million euros, which corresponds to his fixed and variable compensation for the year, Sanofi said in a statement.
On top of that, he will pocket 246,750 euros each month for half a year until June 30, or a total of 1.48 million euros, for not working for a competitor.
Viehbacher also undertook not to hire away previous employees of the company for 18 months and signed a confidentiality agreement for 24 months, Sanofi said.
The total sum is less than the 5.92 million euros he is entitled to under the terms of his contract.
The sacking shocked investors, who had seen the German-Canadian as a good steward of the company, but it came as the group delivered an unexpectedly poor set of quarterly results.
Chairman Serge Weinberg, who has taken on the CEO role while he hunts for a replacement, said he fired Viehbacher for poor execution of strategy and lack of communication with the rest of the board.
Sanofi’s 2013 annual report said Viehbacher was entitled to two years pay “in the event of his removal from office”.
The payment would be calculated on the basis of the fixed part of his pay at the time, plus the most recently received variable pay award, the report says.
Viehbacher’s 2014 fixed pay is 1.26 million euros, and he was awarded variable pay of 1.70 million euros for 2013, making a total entitlement according to his contract of 5.92 million euros.
Additional reporting by Noelle Mennella; Editing by James Regan and Elaine Hardcastle