Renault argues for the dismissal of charges against Luca de Meo regarding his adherence to a non-compete agreement
In a significant decision, the Renault board of directors has chosen not to pay a €5 million non-compete clause to Luca de Meo, the former CEO of the French automobile manufacturer. This decision was made during an extraordinary meeting on August 6.
The reason for this decision lies in the perceived negligible risk given de Meo's new role at Kering, the second-largest luxury group in the world, behind LVMH. The board of directors cited the group's cost-cutting plan to offset disappointing quarterly results as another reason for this decision.
De Meo, who left Renault in July, is now joining Kering and will be receiving a 'taking-up-of-function' indemnity of €20 million from the luxury group. This is not the only financial benefit de Meo is receiving from Kering. According to reports, the executive is also set to receive a signing bonus of up to €20 million each year.
It is worth noting that the payment of de Meo's €20 million bonus could have been poorly received internally by Renault employees. However, the decision not to pay his non-compete clause is allowed under the Afep-Medef code.
The news about this decision was first reported in Les Echos on September 17, along with the news about the payment of the bonus to de Meo. This decision not to apply de Meo's non-compete clause was also reported in the same publication.
De Meo's compensation package when he joined Kering in 2020 was approximately 13 million euros. With his new roles and financial benefits, de Meo is set to make a significant impact in the luxury industry.
This decision marks a new chapter in the career of Luca de Meo and the future of Renault. As de Meo transitions to his new role at Kering, the automobile industry will be watching closely to see how this decision affects both companies.
