$287m golden handcuffs chain Disney boss

JOHN SHEPHERD

Walt Disney's reputation as one of the world's top payers of executives was underlined yesterday with the award of $287m (pounds 182m) worth of share options to Michael Ovitz, the recently-appointed president of the giant media and entertainments group. His base salary is said to amount to $5m a year.

The options, detailed in filings to the Securities and Exchange Commission, have been granted at $57 each - slightly more than $1 below the current stock market price.

Details of his remuneration package help explain why he failed to reach a financial agreement to become head of MCA, the Hollywood studio. Mr Ovitz, better known as Hollywood's "wheeler dealer", is reported to have tried to secure a $360m package from MCA.

The 48-year-old founder of Creative Artists' Agency, the company that changed the way Hollyood did business with the stars, can start cashing in the options between 1988 and 2003, but is restricted to exercising his rights to no more than 1 million shares a year.

Mr Ovitz, who replaces Frank Wells, killed in a helicopter crash last year, will run Disney's theme parks, consumer products division, and film and television interests, including ABC, the US network being bought by Disney for $19bn.

Mr Ovitz was the first agent in Hollywood to package stars, directors and producers from his own stable, and attach them to studio projects. His clients included Barbra Streisand, Tom Cruise and Tom Hanks.

The financial package for Mr Ovitz conforms to Disney's policy of slapping extremely lucrative golden handcuffs on top executives. Michael Eisner, 53,the fabulously wealthy chairman and chief executive, has already earned $500m in cash and stock options since joining Disney 11 years ago.

Since joining Disney in 1984, Mr Eisner has transformed it from a highly regarded but small film production company, with an annual turnover of $1.5bn, into one of the most powerful entertainment groups in the world, with a stock market value of $32bn.