Advertising exec steps down amid expenses probe

A once high-flying Mad Man has crashed to Earth.

Miles Nadal, who spent 35 years atop MDC Partners, a Madison Avenue holding company, has resigned from the firm amid a regulatory probe into expense account shenanigans.

Nadal’s exit, announced late Monday, came as the company said the amount of cash the CEO has returned to the company has swelled to $10.5 million.

MDC, parent of such well-known agencies as Doner, and Crispin, Porter + Bogusky, saw its shares rise 1.3 percent to $17.83 on Tuesday when word of Nadal’s exit became widely known.

MDC shares are down 21.5 percent as the probe by the Securities and Exchange Commission weighed on investors.

The disgraced CEO, who used to commute via the corporate jet between homes in the Bahamas and Florida to MDC’s Fifth Avenue headquarters, also agreed to repay $10.6 million in cash bonuses awarded between 2012 and 2015. And as a final indignity, he’s forgoing $27.2 million in severance and compensation payments for which he had been eligible.

While the savings generated by Nadal’s resignation are considerable, Albert Fried analyst Richard Tullo says he does not expect the fallout to end there.

“It’s really a pathway to a takeover — a way of adding $100 million a year in Ebitda without doing anything special,” he said.

And for a company that reported only $102 million in Ebitda — earnings before interest, taxes, depreciation and amortization — during its trailing 12 months, the $100 million in added cash could quicken the acquisition impulse of every player in the industry.

The math used by Tullo to get to $100 million includes the savings attained by Nadal’s resignation and adds another $20 million in the event a strategic acquirer jettisons the rest of top management.

Another takeover magnet is the $800 million in debt MDC is carrying at 6.75 percent interest. A financially sound acquirer could reduce that rate to 3 percent, Tullo said, thus saving an additional $30 million a year