Xerox (XRX) Director Chuck Prince Shows Zip Support For Stock

In what was supposed to be a display of confidence, newly anointed Xerox director Chuck Prince, the man who came about as close to Citigroup as any mortal could have, has acquired 10,000 shares of his new company’s stock at a purchase price of a little more than $130,000.

That must be reassuring to shareholders! Chuck Prince walked away from Citigroup with a heinously undeserved $95 million and has now condescended to invest less than 1/730th at the company where he has been inexplicably given a role on the board of directors. Back when his appointment was first announced, I wrote that "If I were a Xerox shareholder, I’d be insulted."

Now it gets worse. According to Barron’s, "The stake remains below the ownership requirements set by Xerox. Under the guidelines, directors must own company stock equal to five times the annual cash retainer for directors. New directors have five years to reach the threshold. For 2007, Xerox directors received $65,000 in cash and $65,000 in deferred stock."

I know: he has 5 years but given that he just took a 9-figure pay package for destroying billions in value at Citigroup, you’d think he’d demonstrate that he’s something less than a chump and go ahead and exceed the minimal ownership requirements. That he doesn’t speaks volumes about his lack of confidence in the future of Xerox (Granted he exhibited tremendous confidences in the future of CDOs, so his prediction are worth about enough to buy a can of baked beans and a roll of toilet paper) and his disdain for strong corporate governance.

It’d be nice to see institutional shareholders speak out against his election to the board — but somehow I doubt that will happen.

Zac Bissonnette