Playtech shareholders are strongly criticizing a proposal for senior executives to share a €100m ($110m) bonus pool after the Snaitech sale. [Image: Shutterstock.com]

A lucrative idea

Playtech shareholders are questioning the recent proposal of a €100m ($110m) bonus scheme for top company executives. The gambling software development company announced the package the same day it completed the sale of Italian gambling operator Snaitech for €2.3bn ($2.5bn) to Flutter Entertainment.

Snaitech’s management would have a €34m ($37m) bonus pool under the plan

Current CEO Mor Weizer would be the biggest winner from the plan, although Playtech didn’t outline exactly how much he could receive. A clause would permit executives to receive 10% of the profit from selling parts of the business in the future. Snaitech’s management would have a €34m ($37m) bonus pool under the plan.

Strong opposing views

Certain shareholders questioned why the bonus plan isn’t linked to performance targets.

In an open letter to the company’s remuneration committee chairperson, Australian activist investor Jeremy Raper went as far as calling the bonus plan “the most egregious case of shareholder value expropriation in the history of UK public market.”

would set a dangerous precedent as management could agree to further deals

He believes it would set a dangerous precedent as management could agree to further deals no matter what impact they might have as they would get a cut of the deal.

Plenty of scrutiny

Palm Harbour Capital’s Peter Smith said in his letter that the sole reason for the bonus package is due to the big cash intake following the sale. He believes the executives already receive handsome remuneration that is partially linked to the share price performance.

He noted how the share price dropped following the Snaitech announcement when it should have “rallied strongly,” which he believes is a sign the market agrees with his viewpoint.

CEO Mor Weizer’s total pay packet was €2.9m ($3.2m) in 2023.

Playtech intends to hold a shareholder vote on the matter by the end of November, already having support from 34.4% of the company’s shareholding. Explaining the reasons behind the bonus, Weizer said during a Monday earnings call that it would create incentives for expanding the business and creating more value for investors.