Rimon Infrastructure CEO Yossi Almellem Seeks 1.3 Million Shekel Retention Bonus Amid Stock Surge
Since its IPO on the Tel Aviv Stock Exchange in July 2021, Rimon Infrastructure's stock has surged over 300%, reaching a market value of 5.3 billion shekels. Yossi Almellem, who has managed the company since its founding 24 years ago and holds 13.6% of its shares, is considered the controlling shareholder alongside Granot, an agricultural organization owned by 43 kibbutzim and moshavim. Almellem, 60, is credited with the company's recent growth, and his shares are now worth approximately 719.5 million shekels, with stock options granted in 2021 valued at 56.6 million shekels before tax.
Next month, Rimon's shareholders will vote on updating Almellem's compensation package. The proposal includes a monthly management fee of 126,500 shekels, a 35% increase from 2021, and a retention bonus totaling at least 1.26 million shekels over three years. Unlike previous agreements, this retention bonus is not conditional on Almellem continuing as CEO but applies to any role within the company. The company justifies this by citing Almellem's contribution to growth and the complexity of his role, though questions arise about the need for a retention bonus given his significant ownership stake.
Additionally, the shareholders will be asked to approve the allocation of 196,000 stock options worth 7.5 million shekels, which would increase Almellem's ownership to 15.1%. Such equity grants to a controlling CEO are unusual and have historically faced resistance from institutional investors, though opposition has softened recently. The options can only be exercised if the stock price reaches 179 shekels on average over 30 days, a 25% premium over the current price, aligning Almellem's incentives with shareholder value. However, once the target price is met between August 2027 and August 2032, Almellem may exercise the options at any time, even if the price later falls below the target but remains above the exercise price, weakening the link between compensation and shareholder gains.
If approved, Almellem's annual compensation will reach 5.5 million shekels. Since the IPO, his cumulative compensation totals 17.5 million shekels, with dividends received from 2022 to 2024 amounting to 13.8 million shekels before tax.
