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Monday, 11 March, 2002, 10:19 GMT
ABB ex-bosses pay back benefits
Percy Barnevik
Mr Barnevik will be left with 58m Swiss francs
Percy Barnevik and Goeran Lindahl, the two former chief executives of the Swiss-Swedish engineering giant ABB, have agreed to repay more than half their multi-million Swiss franc pensions and benefits packages.

Mr Barnevik, who is also a former ABB chairman, will pay back 90m francs (38m; $54m) out of his 148m Swiss franc package, ABB said.

Mr Lindahl has agreed to shave 47m francs off his 85m franc package, the company said.

"These settlements, achieved amicably, show that the principles of good corporate governance are being fully implemented in our company," said ABB chairman Juergen Dormann.

Angry investors

The two executives' golden handshakes caused a stir when they were revealed on 13 February, not least because on the same day ABB announced a $691m (486m) loss for 2001 and said it would sack 12,000 workers to cut costs.

ABB investors, who were outraged at the size of the pension and benefit packages, may be partially mollified by the pay-back deal.

But when ABB holds its annual general meeting on Tuesday, critics are expected to ask why the two will still be left with 96m francs between them.

Last month, ABB's vice chairman, Robert Jeker, said Mr Barnevik had informed the board "selectively and misleadingly" about his pay package.

Last November Mr Barnevik made a surprise exit from ABB, following a steady decline of the firm's share price.

Mr Lindahl left the company about a year earlier.

Weak shares

ABB's share price peaked in February 2000 at 54.50 francs, but has plummeted since to trade now at just under 15 francs.

Weighing on the company's share price are anticipated asbestos claims against one of its US subsidiaries.

Last month, ABB almost doubled the amount of money it was setting aside against liabilities relating to asbestos, taking its asbestos provisions to about $940m.

Some analysts say this is not enough; the most pessimistic estimate suggests that $3bn may be needed.

See also:

20 Feb 02 | Business
Double pension from ABB and Kvaerner
14 Feb 02 | Business
Barnevik leaves top job
23 Nov 01 | Business
ABB boss in surprise resignation
13 Feb 02 | Business
ABB launches pension probe
30 Jan 02 | Business
ABB doubles asbestos liabilities
16 Jan 02 | Business
ABB asbestos claims 'set to soar'
14 May 01 | Business
Financier rocks family firms
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