NEW YORK (Reuters) - Apollo Global Management LLC (APO.N) said on Thursday it had entered into three-year agreements with its founders, including billionaire Leon Black, having previously said it was debating whether a contract was necessary in the first place.
Black’s commitment to the firm, which he founded in 1990 with former Drexel Burnham colleagues Joshua Harris and Marc Rowan, was never really in doubt. The three collectively own about 55 percent of the buyout firm and rely on dividends paid on their Apollo shares for most of their rewards.
But Apollo’s decision to opt for a new employment agreement for Black, Harris and Rowan -- which will be on similar terms to their previous contracts but run for three years as opposed to five years previously -- was not accompanied by any details as to why it was necessary.
“Josh, Marc and I strongly believe that the signing of our new employment agreements under substantially similar terms to our original agreements demonstrates our unwavering commitment to Apollo and a clear alignment of interests with our fellow shareholders,” Black said in a statement.
Black’s total annual compensation as CEO will remain $100,000, the same as for Harris and Rowan. Black also took home $104.2 million in dividends, salary and share of profits from the private equity firm last year, more than twice what he got in 2010, thanks to the firm’s record investment payouts.
The announcement on Thursday came after Apollo’s President Marc Spilker said on May 8 on a conference call with analysts that the firm was debating whether an employment contract was necessary.
“Our dialog has centered around two key topics. First, given their active ongoing involvement with the firm, all employment contracts are necessary; and secondly, whether incremental compensation should be considered,” Spilker said at the time.
Reporting by Greg Roumeliotis in New York