Daniel Och’s Compensation

Chidem Kurdas

The chief executive of Och-Ziff Capital, Daniel Och, received $9.4 million in company stock and did not get any non-equity incentive compensation in 2009. All other pay he received was minor, as best I can tell. He took Och-Ziff public in 2007.

The number for 2009 sounds very modest compared to past estimates of how much Mr. Och made.  In 2008, it was widely reported that he was paid a total of about $919 million, which got him the number one spot in a top-paid executives list.  Forbes put his net worth at $3.6 billion as of March 2008, making him 296th on Forbes’ billionaires list.

Perhaps high-water-marks kept incentive pay down in 2009. Or maybe Mr. Och  moderated his compensation in accordance with the spirit of the times to stay on the public’s good side.

By another measure, he took home a lot more in 2009.  Och-Ziff executives’ equity  awards vest in installments of 20% a year. Mr. Och realized $359.4 million from shares he received in the past but that vested in 2009. He still has $1.25 billion in outstanding stock subject to vesting.

The public shares notwithstanding Mr. Och still controls the company he founded—-he owns 77.4% of the voting interest. His wealth shrank as the stock took a beating in the downturn. But he added to his stake starting in late 2008 and with the price coming back, he must have made a big capital gain.

The pay he receives from the company does not reflect the increasing value of the equity he already owns, of course.

Before he founded Och-Ziff in 1994, Mr. Och was a vice president at Goldman Sachs. No doubt he’s better off as a hedge fund manager than he would be at  the beleaguered investment bank.


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