Share scheme will benefit 6200 employees
Industrial Reporter
SUN International SA is to create a R140m employee share trust scheme that will eventually hold 3,5% of the company. This will be one of the largest employee empowerment schemes in SA's leisure and casino industry.
The scheme will include all of Sun International's 6200 employees, enabling each of them to access about R23000 to purchase shares in the group.
Sun International MD Peter Bacon said the trust was created to comply with an undertaking given to casino authorities in provinces where it operates.
While the group had to give the undertakings only for new casinos, it decided to extend the share scheme to all employees.
Sun International has been successful over the past five years in securing casino licences in six provinces, including some of the most desirable casino opportunities available in SA's metropolitan areas.
The group's shareholders gave it the go-ahead on Friday to create the employee shareholder scheme. Bacon said the creation of the trust represented one of the most "comprehensive employee empowerment schemes ever implemented in the tourism and leisure industry in SA".
Sun International was committed to a "new order" in respect of the ownership and benefits of SA's tourism and hospitality industry, he said.
Bacon said the creation of the scheme was a direct result of Sun International's success in recent years. It was only appropriate that all its employees should be able to share in the rewards that came with "hard work, loyalty and service to the company".
He said the establishment of the trust was unrelated to the group's broader black empowerment strategy. The "disadvantaged sector" already participates in the ownership of equity in the properties the group had developed over the past five years.
The group's shareholders had backed proposals in terms of which it would make interest-free loans to the employee trust for the purchase of shares.
The total amount to be made available for the purchase of group shares amounted to about R140m, or about R23000 an employee.
Bacon said there were no plans at this stage to increase the trust's holding in Sun International.
In terms of the scheme, employees assume no risk because they do not purchase the shares individually. They share equally in the trust and benefit through both dividends and growth distributions.
The scheme will be open to all permanent, full-time and scheduled employees with six months or more service.
The trust's stake will not be diluted by employees who leave the company as they cease to participate in the scheme.
No director, executive or senior manager already on a company share scheme can participate in the trust because the new scheme was designed as means of advancing empowerment throughout the organisation.
Trustees will be elected within six months of the scheme becoming operational. Until then, caretaker trustees have been appointed. They are Sun International chairman Don Ncube and company secretary Silvia Bailes.
In its interim report for the six months to December, Sun International reported a 23% increase in revenue to R1,9bn, with revenue from gaming increasing 25% to R1,4bn.
Adjusted headline earnings a share of 8,5c a share were up from 1,8c.
Sun International's share price dropped 1c to close at 230c with 1706403 shares traded in 81 deals on the JSE Securities Exchange SA on Friday.
Apr 14 2003 07:31:51:000AM Larry Claasen Business Day 1st Edition
Monday
14 April 2003
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