THE ASSOCIATED PRESS
Wednesday January 2 5:38 PM ET
SPRINGDALE, Ark. (AP) - Tyson Foods Inc. awarded its chief executive officer a $2.1 million bonus for the latest fiscal year, despite company troubles over the purchase of meatpacker IBP and a federal indictment accusing it of smuggling illegal aliens.
In a filing with the Securities and Exchange Commission (news - web sites) on Wednesday, Springdale-based Tyson Foods said it awarded CEO John Tyson a $2.1 million bonus on top of his $650,000 salary for the fiscal year that ended Sept. 29.
Ed Nicholson, a Tyson spokesman, declined comment on the bonus paid to John Tyson saying the decision was explained in the company's proxy statement to shareholders.
A section in the proxy statement reads, in part:
“The completion of the acquisition of IBP, which had the effect of the company becoming the world's largest protein provider, was an accomplishment which warranted a bonus payment in excess of that determined pursuant to the senior executive performance bonus plan.”
The bonus comes in a year that Tyson had troubles from buyouts to indictments. John Tyson received no bonus for the previous fiscal year.
Tyson Foods' $3.2 billion acquisition of IBP Inc. in September made Tyson the largest meat producer in the world. The longtime leading poultry producer now controls 28 percent of the U.S. beef market, 25 percent of the chicken market and 18 percent of the pork market.
Initially, Tyson accused South Dakota-based IBP of failing to fully disclose its financial condition and tried to cancel the acquisition. IBP sued, and a Chancery Court judge in Delaware ordered Tyson to fulfill its obligation to purchase the meatpacker.
In December, a federal indictment in Tennessee accused the company and six of its managers of conspiring to smuggle illegal aliens into the country.
The defendants are charged with conspiring to import illegal immigrants to work at 15 Tyson plants in Alabama, Indiana, Kentucky, Missouri, Mississippi, North Carolina, Tennessee, Texas and Virginia.
Tyson Foods has denied the charges, saying any wrongdoing that may have been done by its employees was done on their own.
Tyson also announced Wednesday that its annual shareholders meeting will be Feb. 1 in Fayetteville.
Shares of Tyson fell 27 cents to close at $11.28 on the New York Stock Exchange (news - web sites).