How a GE Exec Gained $30 Million: Step 1, Take a Job at Boeing

(Bloomberg) -- Timing is everything. Just ask Kevin McAllister, a General Electric Co. executive who jumped to Boeing Co. shortly before the manufacturing titans bounded to opposite ends of the Dow Jones Industrial Average.

Boeing's grant of 120,000 restricted shares, intended to compensate McAllister for forfeited GE stock and pension, has made him $30 million richer than if he'd stayed, according to recent regulatory filings.

The windfall mirrors a broader shift as the planemaker emerged as the largest industrial company in the U.S., while GE logged one of the deepest slumps in its 126-year history.

Boeing has jumped 124 percent since McAllister became chief executive of its commercial-jet business on Nov. 21, 2016, the best performance on the Dow over that stretch. GE meanwhile plunged 54 percent, the worst showing on the 30-member benchmark.

The stock grant, worth $17.6 million at the close of McAllister's first day at Chicago-based Boeing, was valued at $39.5 million at the end of trading Tuesday. Had he stayed at GE, the equivalent share-based compensation would have shrunk to $9.6 million.

McAllister, an early member of a GE executive exodus, was considered a rising star and a contender to run the aviation business, which makes jet engines and is one of the Boston-based company's jewels. Chief Executive Officer John Flannery, who took over in mid-2017, now is looking at selling or spinning off other divisions, while shrinking corporate operations and giving business units more autonomy.

McAllister today has the third-largest share haul among Boeing executives, trailing CEO Dennis Muilenburg and Chief Financial Officer Greg Smith, filings show. And McAllister has played a role in Boeing's stock run. During his first year on the job, the company notched records for operating cash flow -- $13.3 billion -- and jetliner deliveries as its factories ran more efficiently.

--With assistance from Richard Clough

To contact the reporter on this story: Julie Johnsson in Chicago at jjohnsson@bloomberg.net.

To contact the editors responsible for this story: Brendan Case at bcase4@bloomberg.net, Tony Robinson

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