Leucadia-Backed HRG Cuts Bonuses After RadioShack, Energy Lossesby and
CEO Asali's package plunges about 40% to $12.9 million
Board exercised `negative discretion' on bonuses after loss
HRG Group Inc., the investment firm backed by Leucadia National Corp. and formerly known as Harbinger Group Inc., slashed executive compensation for fiscal 2015 after suffering losses on energy assets and loans to RadioShack.
Chief Executive Officer Omar Asali’s full-year package fell about 40 percent to $12.9 million, as HRG failed to hit return targets, according to a regulatory filing Wednesday. The award for Executive Vice President David Maura dropped to $6.6 million from more than $18 million a year earlier. Asali, who previously was co-head of hedge fund strategies at Goldman Sachs Group Inc., was promoted to CEO New York-based HRG in March.
HRG’s stock slipped 11 percent in the 12 months through Sept. 30, while the Russell 2000 Index was little changed in the period. The company posted a net loss of more than $500 million for fiscal 2015.
“Our compensation committee reserves the right to exercise negative discretion to reduce awards under the annual bonus plan,” HRG said in the filing. “No corporate bonuses were earned by our named executive officers.”
Asali is working to reshape the company after its Spectrum Brands Holdings Inc. unit announced a deal last year to buy the parent of Armor All and STP engine oil. HRG has been winding down its Salus Capital unit, which made loans to RadioShack before the retailer’s bankruptcy. The CEO has also been selling some energy assets after plunging oil and natural gas prices hurt returns. HRG agreed in November to sell Fidelity & Guaranty Life, an insurance subsidiary for $1.6 billion.
Joseph Steinberg, the chairman of Leucadia, oversees the board of HRG as well. Leucadia, the largest investor in HRG, also owns investment bank Jefferies Group.