Monday 19 February 2018

ESB workers could see their shares devalued as more staff join scheme


Emmet Oliver, Deputy Business Editor

ESB WORKERS, who own 5pc of the company, are in danger of seeing the value of their shares in the company reduce as more people join the staff shareholding bloc.

New data shows there are now 10,000 members of the staff shareholding bloc, compared to earlier estimates of 9,000. With more staff set to join, the value of the shares could reduce further.

The company is valued provisionally by the Government at €4bn, based on its net asset value, putting the total value of the staff shareholding at €200m -- which translates into €20,000 worth of shares on average.

A grey market for these shares is due to be set up soon for all 10,000 members.

But due to the nature of the rules of the Employees Share Ownership Plan (ESOP), former ESB staff are also entitled to retain their stakes in the ESOP, leaving the numbers involved at over 10,000.

In a recent speech, the chairman of the ESB's ESOP, David Beattie, also hinted that the numbers could grow even further as staff recruited in recent years join up.

"Following the imminent running of the grey market, that number will potentially extend to include all current staff with more than 12 months' service,'' he explained.

The figures are an average and it is understood staff members have different allocations, depending on their role in the company.

The Government is currently working on plans to sell a minority stake in ESB, but has refused to give overall control to any private sector players. It has also talked about not giving majority control over the ESB's monopoly ESB network assets.

In a speech recently delivered, Mr Beattie outlined the views of the ESOP on the part-privatisation plans. "While we have an open mind on the matter, the strategic thinking that has led the Government to this decision is not clear to us and we would like to understand it.

"We assert that, as the other stockholder, we have a legitimate interest in the process, strategy and outcome. We expect open consultation with us regarding the strategy, desired outcomes and the future governance of ESB,'' he said.

"We look forward to constructive engagement on this matter with the ministers as fellow stockholders. It is key to the future of employee share participation in ESB and we have a unique perspective to bring to the deliberations,'' Mr Beattie said.

Irish Independent

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