News Column

Yahoo's Marissa Mayer Poaches Google Executive Henrique de Castro for COO

Oct. 16, 2012

Brandon Bailey and Jeremy C. Owens

Yahoo

On her first day back from a two-week maternity leave, Yahoo CEO Marissa Mayer announced Monday that she's recruited senior Google advertising executive Henrique de Castro to serve as Yahoo's chief operating officer.

De Castro will become one of Mayer's top lieutenants, serving as the executive responsible for sales, operations, media and business development at Yahoo, which has been struggling to reverse a steady decline in its advertising business. The announcement marks Mayer's most high-profile hire since she took over the top job in July, although she has filled other key posts with executives from outside Yahoo.

The 47-year-old de Castro will be well-paid at Yahoo, which said in a regulatory filing that he will be eligible for stock and options valued at $56 million, in addition to a $600,000 annual salary, a potential bonus of $540,000 and a $1 million cash bonus to make up for compensation he will forgo by leaving Google.

That's almost as much as the $59 million compensation package that Yahoo's board awarded to Mayer last summer. But one analyst said it's not

surprising that Mayer, herself an ex-Googler, would need to offer a sizable pay package to persuade a top executive at Google, the world's leading Internet advertising company, to work for a competitor whose future is more uncertain.

"I don't think it's imprudent. I think she's going to have a hard time getting top talent without handing out big bucks," said Karsten Weide, who follows Internet companies for the IDC technology research firm.

A native of Portugal, de Castro joined Google in 2006 after working at Dell and McKinsey. He's held several senior positions at the Internet giant, including vice president of Google's "media, mobile and platforms" business, a job in which he helped Google surpass Yahoo in selling online display advertising.

De Castro will be filling a new position at Yahoo. Weide said his experience in advertising should complement Mayer's background in engineering and product development, while freeing her to focus on broader strategy for the company.

"Henrique is an incredibly accomplished and rigorous business leader, and I'm personally excited to have him join Yahoo's strong leadership team," Mayer said in a news release Monday. "His operational experience in Internet advertising and his proven success in structuring and scaling global organizations make him the perfect fit for Yahoo as we propel the business to its next phase of growth."

Mayer also touted the hire in a post to her Twitter account, while noting that she was making the announcement "on my first full day back in the office" after giving birth to her son Sept. 30. The 37-year-old Mayer previously said she would take "a few weeks" of maternity leave and that she intended to continue doing some work throughout that time.

The new CEO has kept a relatively low public profile, but she is preparing to give her first quarterly earnings report next week.

"This is a pivotal point in Yahoo's history, and I believe strongly in the opportunity ahead. I can't wait to join Marissa and the team and get started," de Castro said in a statement.

His compensation package includes $18 million in restricted stock, $18 million in stock options and an additional $20 million in restricted stock to make up for benefits he will give up by leaving Google, according to Yahoo's regulatory filing, which said the stock and options will vest over the next four years.

De Castro will start work initially at Yahoo's office in London because he does not have a U.S. work visa. The company said he will transfer to Yahoo's office in Sunnyvale as soon as he can obtain one.



Source: (c)2012 the San Jose Mercury News (San Jose, Calif.). Distributed by MCT Information Services