Accessibility/Mobile Features
Skip Navigation
Skip to Content
Editorial News
Classified Sites

The Canadian Press - ONLINE EDITION

Viacom founder Redstone sees pay bump 77 per cent to $36.2 million on stock option gains

NEW YORK, N.Y. - Viacom Inc.'s nonagenarian founder Sumner Redstone saw his pay jump 77 per cent to $36.2 million last year, reflecting a surge in the value of a preferential investment called stock option equivalents.

That's according to an Associated Press review of securities documents filed Friday.

The executive chairman's special investments rose in value by $26 million. They gained $12.9 million in the prior year. Stock option equivalents, like stock options, rise in value when the stock price rises. When they are preferential earnings — as Redstone's are — a company must account for the rise in value as an expense.

Viacom's widely traded Class B shares rose 56 per cent over its fiscal year to close at $83.58 at the end of September. A slight uptick in pay TV revenue from networks such as MTV and Comedy Central offset a decline at its movie studio, while the company spent $5.4 billion returning money to shareholders through share buybacks.

Redstone, 90, bought the options in September 2006 using cash from salary he had deferred, the filing said. Executives typically defer salary to put off paying taxes until later years. According to the company, other Viacom executives and employees aren't allowed to invest their deferred salary in stock option equivalents.

Redstone controls 79 per cent of the voting stock.

Redstone's salary stayed put at $1.8 million, while his cash bonus rose to $8.5 million from $5.8 million a year ago.

CEO Philippe Dauman's pay package rose 11 per cent to $37.2 million, as a higher bonus offset a decrease in the value of newly granted stock and stock options.

Dauman is getting a raise for the current fiscal year. His annual salary rose to $4 million from $3.5 million on Jan. 1, and his target annual bonus this year is rising to $15 million from $12 million. His target stock option award is rising to $15 million from $12 million.

The Associated Press formula calculates an executive's total compensation during the last fiscal year by adding salary, bonuses, perks, above-market interest that the company pays on deferred compensation and the estimated value of stock and stock options awarded during the year. The AP formula does not count changes in the present value of pension benefits. That makes the AP total slightly different in most cases from the total reported by companies to the Securities and Exchange Commission.

The value that a company assigned to an executive's stock and option awards for 2013 was the present value of what the company expected the awards to be worth to the executive over time. Companies use one of several formulas to calculate that value. However, the number is just an estimate, and what an executive ultimately receives will depend on the performance of the company's stock in the years after the awards are granted. Most stock compensation programs require an executive to wait a specified amount of time to receive shares or exercise options.

  • Rate this Rate This Star Icon
  • This article has not yet been rated.
  • We want you to tell us what you think of our articles. If the story moves you, compels you to act or tells you something you didn’t know, mark it high. If you thought it was well written, do the same. If it doesn’t meet your standards, mark it accordingly.

    You can also register and/or login to the site and join the conversation by leaving a comment.

    Rate it yourself by rolling over the stars and clicking when you reach your desired rating. We want you to tell us what you think of our articles. If the story moves you, compels you to act or tells you something you didn’t know, mark it high.

Sort by: Newest to Oldest | Oldest to Newest | Most Popular 0 Commentscomment icon

You can comment on most stories on You can also agree or disagree with other comments. All you need to do is register and/or login and you can join the conversation and give your feedback.

There are no comments at the moment. Be the first to post a comment below.

Post Your Commentcomment icon

  • You have characters left

The Brandon Sun does not necessarily endorse any of the views posted. Comments are moderated before publication. By submitting your comment, you agree to our Terms and Conditions. New to commenting? Check out our Frequently Asked Questions.


Make text: Larger | Smaller

Brandon Sun Business Directory
Submit a Random Act of Kindness
Why Not Minot?
Welcome to Winnipeg

Social Media

Canadian Mortgage Rates