FINANCIAL PARTICIPATION
Tesco staff share £106m windfall
Up to 45,000 staff at retail giant Tesco have received a multi-million pound windfall as two save-as-you-earn share schemes mature.
With the Tesco share price now over £3 as we go to press, staff who invested in the five-year scheme have doubled their money. General assistants, stock controllers, delivery drivers and section managers will all take a slice, with top investors clearing around £7,000.
Tesco chief executive Sir Terry Leahy said: "Being a shareholder in Tesco is important to so many of our staff because it gives them a personal stake in the company’ s success. SAYE is a safe and convenient way for staff to save and have the option to buy shares. It is also one of the ways we aim to reward our people for their loyalty and continued efforts for customers, as well as being a thank you for all their hard work throughout the year."
Scheme details
Under the SAYE scheme, Tesco staff can set aside a fixed sum from their salary every month for a three- or five-year period. Staff can save between £5 and £50 a month in the schemes.
When the scheme matures they have the option to buy Tesco shares at a price set when they joined the scheme. The share option price set at the start of each scheme is around 20% less than the share price at that time, ensuring that savers make money right away.
Employees who started the scheme five years ago can buy shares at the 1999 option price of 151p each, while those who joined the scheme three years ago can buy shares at the 2001 price of 198p. Staff are then free to sell their shares at a profit or keep them as a long-term investment.
The most recent three- and five-year schemes to be offered to Tesco staff in October 2004 attracted over 44,800 and 24,900 applications respectively.
Want to know more?
Tesco is the UK's biggest private sector employer with over 237,000 employees in the UK. To read the press release online visit www.tesco.com/corporateinfo/
Posted 4 March 2005