⚾ Hardball At SoftBank

The C-suite at SoftBank is going through a bit of turmoil. Chief Operating Officer Marcelo Claure is locked in a pay dispute with the Japanese conglomerate's founder and CEO Masayoshi Son. Claure is seeking $2 billion in compensation over the next several years—SoftBank has a market capitalization of about $85 billion—but Son seems to be willing to offer something in the range of eight-figures.

• According to the New York Times, Claure is prepared to leave SoftBank should he not get the compensation he's asking. As Claure contests, the compensation is directly related to the value his relationships bring to the company.

• SoftBank's share price has been sinking recently as several key investments (including WeWork, Alibaba, and others) have lost the company money and/or left SoftBank's shareholders unhappy, notes TechCrunch.

Side Deals

The New York Times also reports that Claure has been personally investing in companies that SoftBank backs—therefore greatly increasing the values of his own personal shares. "You’re walking terribly close to the line between legal and illegal and ethical and unethical,” Aswath Damodaran, professor at the NYU Stern School of Business, said of the uncommon (though not unheard of) behavior. 

The Verdict

$2 billion in compensation, even if over a few years, is…a lot. Also, the gap between Claure's figures and Son's is very wide. Claure is clearly playing hardball here, knowing full well that if he leaves SoftBank it'll significantly hurt the company. But will Son fold?