Cleco’s CEO could receive more than $29 million in compensation, and its remaining top six executives could get $20 million total if the company is acquired by suitors now interested in the utility company, corporate filings show.
Compensation packages are common among corporations for high-level executives as part of a “change in control” provision.
Cleco Corp. confirmed Monday that more than one company has offered to acquire the Pineville-based utility, an announcement that drew the ire of a central Louisiana regulator who said Cleco’s CEO should be asked to resign.
Cleco subsidiary Cleco Power, a regulated electric utility, serves about 284,000 customers in Louisiana through its retail business and supplies wholesale power in Louisiana and Mississippi. Cleco Power owns 11 generating units. Among its service areas are Acadiana and the north shore.
“It is in the best interest of Louisiana the Cleco board of directors calls for the resignation of their current CEO,” Louisiana Public Service Commissioner Clyde Holloway, R-Forest Hill, said Monday in a statement. Holloway represents District IV, which includes 17 parishes.
“Under the leadership of Bruce Williamson, this central Louisiana company no longer practices the type of positive community partnership in this area (central Louisiana) once shared with Cleco,” Holloway said. “And now the employees of the company have to work under the constant threat the company is for sale due to the fact the board and CEO have no ties to central Louisiana and only a few to Louisiana.
“… I take great issue with the fact Cleco’s major corporate decisions are not being made by people in central Louisiana. Those decisions are being driven by Wall Street rather than central Louisiana,” Holloway said. “I am concerned about rate payers, and in this particular case, the future economic impact Cleco has on the local economy.”
Cleco said it has hired Goldman Sachs & Co. and Tudor, Pickering, Holt & Co. as its financial advisers help to evaluate proposals. The company has not established a definitive timeline to complete a review and no decision has been reached at this time.
Cleco said there is no guarantee the review will result in a merger or business combination. Under a change in control provision, Williamson’s compensation would include $4.4 million cash severance; immediate vesting in the Supplemental Executive Retirement Plan, a benefit valued at $11.4 million; $12.9 million worth of stock; and three years of medical coverage, valued at $523,159, according to filings with U.S. Securities and Exchange Commission.
Cleco also would buy Williamson’s house and pay his moving expenses. He would get the larger of the average appraised value or its documented cost but not more than 120 percent of its purchase price, if he moved at least 60 miles away.
Cleco said it does not intend to make any further announcements regarding the review unless its board of directors approves a specific deal or a course of action that requires disclosure.
The Wall Street Journal has reported that Cleco is exploring a sale. CenterPoint Energy Inc., a Houston-based power company, is interested, as is Borealis Infrastructure, a unit of the Ontario Municipal Retirement System.
Cleco’s stock closed Monday at $58.02, up 42 cents, or 0.7 percent, for the day, but is up nearly 10 percent since reports of potential suitors surfaced Thursday.