DealBook: Nasdaq Cuts Chief’s Bonus Over Facebook I.P.O.

Lucas Jackson/ReutersRobert Greifeld, the chief executive of the Nasdaq OMX Group.

The board of the market operator Nasdaq OMX Group has cut the 2012 bonus of the company’s chief executive, Robert Greifeld, by 62 percent, as a result of the botched Facebook initial public offering last May.

Over all, Mr. Greifeld earned $8.9 million last year, including salary, stock awards and a “non-equity incentive plan compensation” of $1.35 million, down from a 2011 bonus of $3.59 million. In 2011, he received $7.6 million in total compensation.

The board also reduced the bonus of Anna Ewing, executive vice president of global technology solutions, the company’s top market technology executive, by 53 percent, to $574,125.

In a securities filing on Thursday, the company said that the management compensation committee and the board “explicitly considered the Facebook I.P.O. in connection with their review and determination of these reduced payouts. ”

The trading debut of Facebook shares on May 18, 2012, was the most anticipated market event in more than a decade, generating intense interest among retail investors as well as on Wall Street. But the start of trading was marred by what Nasdaq calls “systems issues,” including a surprising opening delay and missing trade execution messages. Amid the chaos of the day, the electronic market had to fill out out orders by hand for a spell.

The market operator has pledged to pay $62 million to member firms who suffered losses during trading that day as a result of computer malfunctions.

In a statement last summer, Mr. Greifeld said: “We deeply regret the problems encountered during the initial public offering of Facebook, We failed to meet our own high standards based on our long history of providing outstanding technology to our members and exchange customers. We have learned from this experience and we will continue to improve our trading platforms.’’

Bits Blog: In Shake-Up, Apple's Mobile Software and Retail Chiefs to Depart

Jeff Chiu/Associated Press Scott Forstall at an Apple event in September.

Scott Forstall, who has run software development for Apple’s iPad and iPhone products, and John Browett, the head of the company’s retail operations, are leaving Apple, in a rare management shake-up at the company.

The departure of Mr. Forstall, an Apple veteran, will shift his responsibilities to several other Apple executives. Most notably, Eddy Cue, the head of Apple’s Internet services, will take over development of Siri and maps, two efforts Mr. Forstall oversaw that have been widely criticized for their reliability and accuracy.

Apple said in a news release that the management changes would “encourage even more collaboration” at the company. Mr. Forstall will leave Apple next year and serve as an adviser to Tim Cook, the chief executive, in the meantime.

Dixons Retails, via Associated Press John Browlett

Jony Ive, the head of Apple’s industrial design, will take on more software responsibilities by providing more “leadership and direction for Human Interface,” Apple said. Craig Federighi, who was previously in charge of Apple’s Mac software development, will also lead development of iOS, the software for iPads and iPhones.

The departure of Mr. Browett, who joined Apple only in April to lead its retail operations, followed a number of missteps by him. In August, Apple took the unusual step of apologizing for a plan to cut back on staffing at its stores. Apple said that a search for a new head of retail was under way and that the retail team would report directly to Mr. Cook.

Pearson Chief’s Departure Could Lead to Sale of Financial Times

The first female chief executive of a FTSE 100 company had previously declared that the famous pink-paged FT title would only be sold "over my dead body". The FT Group also holds a 50 percent stake in the Economist.

She will step down at the end of the year to be replaced by John Fallon, the chief executive of Pearson's international education division since 2008.

Analysts said the choice showed where the group's priorities lie and that the 50-year-old Fallon would now have to also focus on the large education business in the United States, which has been hit by tight school budgets.

"Ms Scardino was a big fan of the FT and resisted attempts to sell the business," Ian Whittaker at Liberum said. "We see John Fallon as having no emotional commitment to the division. We value the FT Group at around 770 million pounds."

Shares in the group were down 0.6 percent, slightly underperforming a flat FTSE Index.

Both Bloomberg and Thomson Reuters have been linked with a purchase of the FT Group in the last year but analysts note that Pearson has a strong balance sheet and would only need to sell the FT if it needed the money for a large and transformational deal.

Although the FT Group has succeeded in growing digital sales and subscription revenues, a sale of the title would still fit with the group's wider strategy of moving away from volatile advertising revenues.

Investors could also question the future of the book group Penguin within the wider firm as some analysts believe it also fails to support the growth of the dominant education division.

Scardino, one of the longest serving bosses of a FTSE company, transformed a diverse set of assets into a successful global educational and media business.

"She navigated two recessions, one financial crisis, a dot com boom and bust and several waves of structural industry change," Pearson chairman Glen Moreno said.

"Not only are Pearson and Marjorie still around to tell the tale but over the past 16 years our ... profits have hit last year's all time high."

EVER-CHANGING PORTFOLIO

During her tenure, Scardino led a string of major deals.

In her early years she sold off such leisure attractions as Madame Tussauds and Alton Towers, stakes in BSkyB and investment bank Lazard before selling in more recent years a stake in Interactive Data Corp and a 50 percent stake in the FTSE International.

The numerous disposals have allowed it to expand its education and testing business around the world. The group has tripled sales to nearly 6 billion pounds under Scardino's watch and grown profits more than three times to a record high of 942 million pounds in 2011.

The Pearson share price has risen by 88 percent since Scardino took over in 1997, compared with the FTSE All-share Media index which is up 8 percent in the same period.

"We question whether Penguin and FT Group fit strategically, given Pearson's skew to education," Investec analyst Steve Liechti said. "Fallon is not a life-long publisher, so could be more brutal in his strategic direction in time, and shareholders would push for asset sales and cash returns in our view."

Chairman Moreno said he did not see the new appointment as a signal for a change in strategy. But analysts warned that the new appointment could lead to further changes within senior management, if executives overlooked for the top job decide to move on.

(Reporting by Kate Holton; editing by Keith Weir and Anna Willard)