By Ryan Dezember
Michael J. Cavanagh, who stunned Wall Street last year when he
left J.P. Morgan Chase & Co. for a private-equity firm, is
joining Comcast Corp. as chief financial officer after less than a
year at Carlyle Group LP.
Mr. Cavanagh, a James Dimon protégé who was considered a
possible successor to the J.P. Morgan chief executive, comes to
Comcast as the cable giant looks to regroup after the collapse of
its $45.2 billion deal for Time Warner Cable Inc. He is replacing
Michael J. Angelakis, who will l ead a $4.1 billion investment
company with Comcast and become a senior adviser to the
company.
"Mike is going from one great company to another," a Carlyle
spokesman said Monday. "We have a deep bench of talent."
Mr. Cavanagh, 49 years old, joined Carlyle last summer as
co-president and co-chief operating officer alongside longtime
Carlyle deal-maker Glenn Youngkin. The two men jointly ran the
Washington, D.C., firm's day-to-day operations. Before that, Mr.
Cavanagh was co-head of J.P. Morgan's Wall Street operations.
Mr. Cavanagh's decision to leave J.P. Morgan came as a shock to
many in the bank. "This was hands-down the hardest decision I've
ever had to make," he said in an internal memo at the time. Mr.
Dimon called it "a regrettable loss for our company."
His departure from Carlyle also caught Wall Street off guard, as
he was one of several executives expected to lead the
private-equity firm when its three founders, all in their 60s,
retire. Carlyle, which went public in 2012, has been among the more
transparent private-equity firms when it comes to succession
planning.
Carlyle executives were surprised when he told them Friday he
was leaving, according to people familiar with the matter.
Carlyle rolled out a lucrative pay package for Mr. Cavanagh,
whose 2014 compensation at the firm was valued at $31.2 million.
But in leaving Carlyle after less than a year, he is forfeiting
much of it, including about two-thirds of $30 million in payments
intended to compensate him for J.P. Morgan stock that he left on
the table when he quit the bank, according to people familiar with
the matter.
In all, Mr. Cavanagh received about $14 million in cash and
stock from Carlyle, according to securities filings and people
familiar with the matter.
In a statement Monday, Mr. Cavanagh said the Comcast opportunity
was "something I could not pass up." He's expected to start in his
new role by July 6, and his employment agreement is effective
through 2019, according to a regulatory filing. Carlyle has waved
the monthslong period Wall Street workers traditionally take off
between jobs, known as gardening leave, people familiar with the
matter said.
Comcast gave Mr. Cavanagh a $10 million signing bonus made up of
performance-based stock that vests in 13 months, as well as $2.5
million in restricted shares that vest over three years. He is also
due another $10 million in deferred compensation that is subject to
clawback should he leave within a year.
Mr. Cavanagh's annual base pay will be $1.8 million this year
and is scheduled to rise 5% a year. He is also due annual cash
bonuses of up to 300% of his base pay. And Comcast said it would
also compensate him for stock-based pay he left behind at
Carlyle.
Mr. Cavanagh's appointment comes after Comcast's deal to buy
Time Warner Cable fell apart last month under pressure from
regulators. Some analysts have speculated that the cable giant
could attempt another major deal, make a push into the wireless
business or seek to buy overseas targets.
Comcast has looked at various international assets in recent
years, including in India, but hasn't been convinced to pursue a
deal, The Wall Street Journal reported last month.
The company last week reported better-than-expected profit and
revenue growth as the broadband business more than made up for a
surprise loss of video customers in the first quarter.
Write to Ryan Dezember at ryan.dezember@wsj.com
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