Jumbo Bonuses: Luring Top Execs With 'Golden Hello'

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Nov. 19 (Bloomberg) -- More U.S. companies are luring top executives with multimillion-dollar "golden hello" signing bonuses, undeterred even as high-profile flameouts such as Ron Johnson’s short tenure at J.C. Penney expose the risks. Julie Hyman reports on Bloomberg Television's "In The Loop." (Source: Bloomberg)

But now is this surge in these golden hello's. there has been focus on golden parachutes and not so much on these golden hello's. it is a writing phenomenon.

According to gmi ratings, we are seeing it in 2013 just up until now, 70 firms offering these packages from only 41 in all of 2012. companies who are offering these packages are saying that one of the purposes are to replace some of the lost income from the place that these ceos may be leaving.

Obviously, it is an enticement for some of the ceos to come on.

The biggest package we have seen is jxinga offering a $45 million package.

Another one was an $8.6 million signing bonus.

The risk is that the pale this money and you hope that it pays off.

In the case of hp, it's very spectacularly dead on.

He was at the company 10 months.

The stock fell 50%. he walked away with nearly $35 billion total.

If you look at some other examples of this that did not work out, jcpenney's ceo, ron johnson, the stock fell by 50% under his tenure.

He got one of these golden hello's to entice him away from apple.

There are other cases when it has worked out better.

We were talking about best buy earnings this morning.

Their ceo got one of those.

The stock has gone up at least until now.

Also in the case of zyngam,, the jury is still out on his performance.

He has only been there since july.

We will see how that pays off.

Thank you.

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