Mark Hurd, who resigned as CEO of Hewlett-Packard a month ago with a severance package of almost $40 million, reportedly will be paid $950,000 (£617,000) .a year as Oracle’s new co-president, and could stand to make as much as $10 million (£6.5m) in bonuses.
According to filings with the Securities and Exchange Commission, Hurd also will be offered a stock option to buy 10 million shares of Oracle now, and will be eligible to buy 5 million more annually for the next five years, as long as he stays employed by Oracle. Hurd also will be up for nomination to the company’s board of directors.
Oracle hired Hurd as co-president 6 Sept, a month after he left HP under pressure following an internal investigation into a sexual harassment complaint filed by a former HP contractor, Jodie Fisher, and accusations that he falsified expense reports to cover his personal relationship with Fisher.
Hurd had spent five years at the helm of HP, and was widely credited with driving costs down and profits up, as well as completing the integration of Compaq and expanding HP’s reach through such acquisitions as services vendor EDS.
After Hurd’s resignation, Oracle founder and CEO Larry Ellison became one of his most vocal supporters, sharply criticizing the HP board for “the worst personnel decision since the idiots on the Apple board fired Steve Jobs many years ago.”
Upon hiring Hurd, Ellison said that “Mark did a brilliant job at HP, and I expect he’ll do even better at Oracle. There is no executive in the IT world with more relevant experience than Mark.”
HP on 8 Sept. filed a lawsuit against Hurd in a California state court, saying that his hiring by Oracle violates confidentiality provisions in his severance agreement. The HP lawsuit can be found here.
“Mark Hurd agreed to and signed agreements designed to protect HP’s trade secrets and confidential information,” HP said in a statement. “HP intends to enforce those agreements.”
Ellison fired back later in the day, saying that the lawsuit threatened to damage the working relationship between the two companies.
“Oracle has long viewed HP as an important partner,” Ellison said in a statement. “By filing this vindictive lawsuit against Oracle and Mark Hurd, the HP board is acting with utter disregard for that partnership, our joint customers, and their own shareholders and employees. The HP Board is making it virtually impossible for Oracle and HP to continue to cooperate and work together in the IT marketplace.”
Oracle and HP have been longtime partners. However, Oracle is looking to expand beyond its traditional software business to become more of a complete IT solutions provider. Earlier this year, Oracle bought Sun Microsystems for $7.4 billion, a move that not only brought such Sun technologies as Solaris and Java into the fold, but also its extensive hardware portfolio.
Oracle officials are looking to tightly integrate their software with Sun hardware to create appliances, though they also will sell systems that will run other vendors’ software.
This week, eWEEK Europe’s poll is on the subject of what Oracle is getting for its money in hiring Mark Hurd. Until 17 Sepotember, the poll is in the box on the left of this story, and it’s getting some interesting results. Let us know what you think.
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The September 8 edition of Collins Stewart's report on Winners & Losers in IT Consolidation has Oracle as the least capable of the top 5 Enterprise IT Vendors, and says that it would "now want in to the HW business having acquired Sun as its first move. The most interesting development will be to see how it takes the hardware business forward." While it had some obvious risks (i.e. HP lawsuit), the grab was a gamble & a clever attempt at harvesting the resources needed to realize that growth strategy.
I would say more like corporate cronyism. The two are good friends, and the charges were pretty sketchy. Larry just saw an opportunity to hire a good friend who he thinks will do a good job. I wonder if the HR department had to post this position and go through the normal process of hiring Hurd. lol
I didn't know about their friendship but it seemed to be an excellent hire. Mark Hurd's ability to reshape HP, at least for a time, exhibited quite the executive business acumen.
Pay attention to Oracle now...they may start incremental improvements that take the Googles, Apples and Microsofts by surprise ;-)
Hurd is good, and Ellison needs help, simple.
However, the board's of both companies must be full of weak knees as the salaries being paid out in this game are ludicrous, they're on a par with the over paid banking industry.
But I will bet all the employees still have to watch the business ethics videos every year Hurd is there. :-)
I heard it once said that "ethics are situational". So perhaps Ellison is interested in a particular skill set of Hurd's and not worried about the situation
Could be that his skill as a leader was critical to HP hardware just turn into something from nothing. That coupled with Oracle now owning a server company that is lost. People still do get hired on achievements not just media and BLOG BS.
Larry is a megalomaniac with Gates-envy. He is the real-life embodying of the cartoon character 'Brain', in 'Pinky and the Brain'. He is also ruthless and will do anything that *may* bring him one step closer to 'ruling the world'. - Just me exercising my right to free speech. :)
I think it is right strategy - HP is a competitor to Oracle.
Oracle needs to Mark if it needs to succeed in Hardware business
HP doesn't need any help looking stupid. Let's see, they hired Carly. That's one. The board let Carly take them for a he** of a ride. I think her parachute was even shinier than Kevin Rollins'.... hahahahahahahahahaha.... sorry! Did I mention every last one of their client products are the sorriest junk on the market? I will not be at all surprised when Asus buys their client division in 2014. Then, Oracle will pick apart the remains of their enterprise...ahem... offerings.