Wipro’s outgoing CEO adds to his resignation bounty with $4-mn share sale

The amount Delaporte has earned from the share sales are in addition to the first-of-its-kind cash payment of ₹36.13 crore that Wipro has offered to any of its outgoing executives.

It is unclear if Wipro allowed an accelerated vesting of Delaporte’s shares awarded under its employee stock option plan, or ESOP, or of the total number of Wipro shares he owns.

Delaporte was replaced as CEO by Srinivas Pallia last month, but will continue with Wipro until 31 May. While Pallia stands to make up to $7 million in remuneration in his first year, Delaporte’s annual remuneration when he was in office was $10.1 million. Delaporte's remuneration for 2023-24 will be known when Wipro publishes its annual report.

Following his resignation, Delaporte first sold shares worth ₹21.4 crore on 26 April, followed by another ₹13.1 crore of share sales on 8 May, show stock exchange filings reviewed by Mint.

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“This could be in the nature of a severance pay as Delaporte had a five-year contract and he has resigned prematurely to facilitate a new CEO," said Shriram Subramanian, founder and managing director of proxy advisory firm InGovern Research. 

“As he is a French national, and French employment laws are more stringent, this cash compensation could be to mitigate any adverse consequences, including non-solicitation and non-disparagement," said Subramanian.

Wipro did not immediately reply to Mint’s email seeking comment.

$14 million in share sales so far

Although Wipro maintains Delaporte resigned, Mint reported on 7 April that chair Rishad Premji, unhappy with the company’s performance, had asked him to put in his papers.

Wipro’s revenue declined 3.8% to $10.8 billion in 2023-24, while that of Tata Consultancy Services Ltd improved 4.12% to $29 billion and Infosys Ltd’s by 1.9% to $18.56 billion.

“Shareholders will likely get to know about the accelerated vesting of shares when the FY2023-24 annual report is out soon," said Subramanian.

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During Delaporte’s nearly four-year stint between 6 July 2020 and 6 April 2024, he has sold Wipro shares worth ₹83.7 crore, according to a Mint review of filings made by company executives to the Bombay Stock Exchange, bringing his total share sale to ₹118.2 crore, or about $14 million.

“This ( ₹118.2 crore) is a very good sum of money," said the head of a proxy advisory firm on condition of anonymity, adding, “Companies, when they ask a CEO to leave, typically allow an accelerated vesting of shares and this is not something unusual."

More than his predecessor

Delaporte’s separation money is more than what his predecessor, Abidali Neemuchwala, made, according to filings made by the company. 

Neemuchwala, who resigned in the summer of 2020 before completing his five-year tenure, earned $4.4 million for the year ended March 2020. His remuneration included his salary, variable pay, and cost of accelerated vesting of unvested share options. 

Neemuchwala, who was based out of Dallas, Texas, had 960,000 of unvested American Depository Shares when he resigned. He owned ADS as Wipro is listed both on Indian stock exchanges and on the New York Stock Exchange.

Neemuchwala, whom Wipro founder-chair Azim Premji hired from Tata Consultancy Services, announced his resignation on 31 January 2020, but continued until 1 June. He earned $305,845 between 1 April and 1 June 2020.

Other ex-CXOs too sell shares

In addition to Delaporte, at least two other executives who joined Wipro under his watch and who are now no longer with the company, also made a decent amount of money from ESOPs. 

Anis Chenchah, who joined Wipro in April 2022 as the CEO of its Asia Pacific, India, Middle East and Africa region, only to resign last week, sold shares worth ₹37.77 crore earlier this month.

Ohio-based Stephanie Trautman, who joined as Wipro’s chief growth officer in February 2021, with the mandate to bolster the company’s ability to win mega deals, or contracts worth more than $1 billion in value, resigned in December. Trautman has sold shares worth ₹7.39 crore.

Also read | Mega deals dried up at Wipro before team lead’s departure

Wipro’s shares have declined by about 3% on NSE since Delaporte announced his resignation on 6 April, a Saturday–from ₹479.90 apiece on 8 April to ₹464.00 at close of trading on Thursday.