The $75 billion merger between commodities trading house Glencore International and Xstrata for form Glencore Xstrata plc was completed in April of this year. In December of 2012, several Xstrata executives received millions of dollars in bonus payments that had been rejected by shareholders

As part of the original merger offer, about 70 Xstrata executives were in line to receive some $223 million in retention bonuses, with Xstrata’s CEO looking at a payout of around $47 million. After a shareholder vote in late November, the merger was approved but the retention bonuses were not.

According to Bloomberg News, Xstrata CEO Mick Davis paid his colleagues “transaction” bonuses. The payments came to light as part of a lawsuit in London involving a former Xstrata executive who was paid a transaction bonus of $783,000, but sued claiming he was owed a severance payment of about $667,000 when he was forced to resign. The severance payment was part of the executive’s contract while the transaction bonus was not, according to lawsuit.

The letter from Davis announcing the bonuses was quite cheery:

The task of achieving a merger between Xstrata and Glencore has brought with it many hurdles along the way and has been a real test of our character to rise up and meet such obstacles. … I would like to thank you for the contribution you have made to get Xstrata to this point of the merger and am pleased to inform you that you have been awarded a transaction bonus.

Bloomberg cites the head of research at a U.K. body established to monitor public and private compensation:

It seems like a classic example of firms not wanting to heed investors’ advice on pay. These payments should certainly be disclosed and explained.

Now there’s a classic British understatement for you.

Glencore Xstrata paid Davis about $7.4 million after terminating his six-month appointment as CEO of the combined companies.

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