The sudden departure of Chris Littlefield from FGL Holdings apparently caught him by surprise as much as it did us at the Business Record. I had interviewed Littlefield on Dec. 6 for our upcoming annual public companies issue (this one); less than two weeks later the company announced that he had been replaced. Regrettably, the Q&A that resulted from that interview I had with Littlefield became moot and will remain unpublished.

Littlefield led FGL, the parent company of Des Moines-based Fidelity & Guaranty Life, for four years, culminating with the completion a year ago of a $1.84 billion acquisition by an investment group. The Bermuda-based annuity and life insurance company now employs more than 300 people between its Des Moines headquarters and Baltimore office, including more than 150 employees in downtown Des Moines.  

Although Littlefield lost potentially tens of millions of dollars in stock options that were canceled by the company, SEC filings from FGL show that he walked away with $4.8 million in compensation and bonuses as part of his severance package. Littlefield had held options for more than 2.7 million shares of FGL, 30,000 of which he had just purchased in September. In recognition of the lost options, FGL awarded Littlefield an additional payment of $500,000 in the severance package. 

Littlefield’s successor, Christopher Blunt, will be paid a base salary of $800,000 per year, plus a “target bonus opportunity equal to 200 percent of his base salary, subject to the achievement of criteria to be established by the Board of Directors.” Blunt, 56, held several senior leadership positions during a 13-year tenure with New York Life before joining Blackstone Group as CEO and senior managing director a year ago. 

Blunt also received 3.2 million nonqualified stock options of FGL, along with a “stretch award” of 613,476 nonqualified stock options if he achieves performance-based targets tied to FGL’s return on equity and stock price goals. 

The leadership shakeup was part of several strategic moves that FGL disclosed in the pre-holiday announcement, among them a $150 million stock repurchase program and FGL’s first dividend payout. 

The company also announced a new “cost reduction program that is expected to generate approximately $15 million of annualized expense savings once completed.” A portion of these savings will be reinvested in strategic growth initiatives in 2019, including new capabilities and resources to enter the independent broker dealer and bank channels, FGL said.