Longs Drugs CEO Set for Fat Merger Payday

OKLAHOMA CITY -- No wonder Warren Bryant jumped at the chance to run Longs Drug Stores (LDG Quote).

Bryant could have held out for the top spot at Kroger (KR Quote), the giant grocery chain where he started out as a part-time bagger and rose through the ranks to become senior vice president. After all, Kroger wound up hiring a new CEO the year after Bryant departed.

But Kroger offers no special change-of-control benefits for its executives.

Longs, however, promises its CEOs generous payouts -- exceeding those offered by some of its largest rivals -- if the company sells itself.

Bryant could snag up to $23.6 million if a deal to be bought by CVS(CVS Quote) goes through. In contrast, critics estimate, CEOs at much-larger Walgreen (WAG Quote) and Rite Aid (RAD Quote) would secure $12 million to $15 million in a similar situation.

All told, regulatory filings show, Longs' top five executives could score more than $45 million once the company changes hands. They simply need to leave for a "good reason" -- and relocation now counts -- in order to secure their maximum payouts.

Last month, industry giant CVS offered $2.9 billion for the regional drugstore chain. That all-cash tender offer, which translates into $71.50 a share, represents a 32% premium over Longs' pre-announcement stock price.

Since then, rival Walgreen has offered Longs an even higher $75 a share. Longs' board -- which is chaired by Bryant -- has pledged to review that competing offer. Meanwhile, however, the board continues to formally support the lower CVS bid -- and the big executive payouts that come with it.