A unique share scheme will see thousands of British Steel employees given a 5 per cent stake in the business by its owners, Greybull Capital LLP.
The news has been revealed today on British Steel’s first anniversary and follows a pledge from the family investment office when it launched the company in June last year.
Since then British Steel has reversed a trend of multi-million-pound losses and delivered consistent profits.
Greybull Capital said the share scheme is just reward for employees who have embraced and led the company’s transformation plan.
A spokesperson said: “This is a unique scheme for a unique group of people. From the moment acquisition talks started, we were not only inspired by their remarkable pride and passion but by the incredible skills they use to deliver world class products across the globe.
“The workforce were a major reason behind our takeover and, since the sale was agreed, their attitude, vision and professionalism has justified our confidence in them and the business.
“At launch we said we wanted British Steel employees to own a share of the company. This is us delivering on that promise and I have every faith they will continue to make British Steel the success their efforts merit.”
British Steel Managing Director Paul Martin said: “Every one of our employees has contributed to the turnaround of this business – they are the foundation of our recent achievements and, just as importantly, they are critical to our future.
“It is therefore important that we not only reward them for their efforts during the last 12 months but, as we move forward and grow the business further, they continue to share in any ongoing success.”
In the last financial year, British Steel committed £39 million to capital investment and as the company looks to build a sustainable future Paul Martin said: “Linking this scheme to the future sustainability of British Steel makes perfect sense and while we have a considerable way to go, I know we have the people to help us achieve our long-term vision.”
Paul McBean, multi-union chairman at British Steel’s Scunthorpe headquarters, said: “We warmly welcome this move by Greybull Capital to reward employees with a stake in the business that runs through their veins. They have helped transform the company and it is fantastic to see they will share in the success we are starting to see.”
Under the scheme one million shares will be allocated to employees on June 1 each year, starting this month. The overall number of shares in issue will always equate to 5% of the overall equity of the company.
British Steel employs 4,800 people and all employees will be entitled to an equal share of the allocation.
Employees who have been in the business since before June 1 2016 will receive their share of the first allocation this month. Eligibility for future share allocations will be based on employees being in the business for 12 months prior to the date of each new issue.
People will only retain their shares while they are employed by the company. Employees on fixed-term contracts, agency employees, contractors and apprentices will not be included in the scheme. The share scheme is totally separate from the bonus scheme and does not replace it.
The share scheme has been designed specifically for British Steel by KPMG in partnership with Greybull Capital.
Chris Barnes, Partner and Head of Reward, KPMG UK, said: “People are the driving force behind the regeneration of British Steel and this new, balanced scheme has been designed to ensure that all employees, from hydraulic engineers to sales executives, will benefit from future growth. The simple, clear structure that has been proposed to staff will make the programme very accessible and we look forward to managing what is a very positive initiative for the steel industry.”