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Skype Fires Senior Execs Before Microsoft Deal Closes, Reducing Payouts

Fin - Daily Ticker - US

The online telephone company bought by Microsoft for $8.5 billion, Skype, has fired a bunch of senior executives before the deal closes, Bloomberg says. This move will reduce payouts to these executives, Bloomberg adds, thus making the payday for Skype's owners and other managers bigger.

Bloomberg doesn't say explicitly that the executives were fired to reduce their payouts, but that is certainly the implication.

If it's also the truth, this move will likely trigger a backlash in Silicon Valley, where executives count on equity (options and stock) as a major portion of their overall compensation.

Aaron thinks the deal might finally be a sign that senior executives will no longer make out like pigs at the trough in deals like this, while rank-and-file employees get hosed.

If so, that would be good news (fairness is good), but I suspect there's more to the story than Bloomberg has revealed.