Heinz pays chief executive $9.2 million

Former CEO William Johnson got $110.5 million for eight months to December 29

Ketchup maker Heinz paid Bernardo Hees $9.2 million in his first year as chief executive officer.

The package includes an incentive payment of $1.2 million, $7.3 million in option awards and $561,538 of salary, Heinz said today in a regulatory filing.

New chief financial officer Paulo Basilio received $3.8 million. Mr Hees joined from Burger King Worldwide, the fast- food chain owned by Jorge Paulo Lemann’s 3G.

Mr Hees replaced William Johnson, CEO since 1998, who got $110.5 million in the eight months ended December 29.

Mr Hees has closed factories and consolidated offices as part of a plan that eliminated about 3,400 jobs to boost profit.

Berkshire and 3G each paid about $4.3 billion for equity in the company, and Buffett’s firm provided an additional $8 billion for a preferred stake with a 9 per cent annual interest payment. The arrangement, in which Berkshire provides financing and a partner oversees operations, could be a “template” for future deals, the billionaire wrote in the letter.

Mr Johnson’s package includes a $48.8 million payment tied to equity awards that were outstanding when the deal was completed. Heinz said last year Mr Johnson could receive “golden parachute compensation” including $56 million in cash, equity, bonuses and other benefits.

Michael Mullen, a spokesman for Heinz, said the job cuts are part of a continuing plan to improve the company.

“The difficult actions we are taking now will result in Heinz becoming a stronger and more nimble organisation that is better-positioned to become one of the most efficient food companies in the world,” Mullen said in an e-mail.

Bloomberg