Sheffield Forgemasters: Who gets what from Government's £2.58m in shares buyout?
Over half of the Government’s £2.58m offer to acquire Sheffield Forgemasters will end up in the pockets of employees or former employees.
This week, the MoD announced it would acquire the city steel manufacturer by purchasing 100 per cent of its shares.
The buyout has been welcomed by unions and the company – but the sale also indicates employees will be rewarded for their loyalty and investing in the firm in the past 15 years.
As of this week, 32 per cent of Forgemasters shares are held by either by former employees and 31 per cent is held by the firm’s Employee Benefits Trust.
It means a total of £1.625m from the sale will end up in the pockets of its workers or its staff enrichment schemes.
It is not known how many individual investors will receive a share of the money.
It comes after a rocky history for the firm after staff were invited to dig deep into their own pockets to keep it afloat.
After a buyout in 2007, workers were offered shares at half price for 80p. This was not the only time they were asked to support the firm in the past 15 years.
Further, in April 2019 the company’s shares had slumped to 53p. The sale to the MoD has been agreed at 127p a share.
However, the lion’s share of the cash will go to Forgemaster’s former boss of 16 years Graham Honeyman. With 31 per cent of the stock, he was the firm’s largest individual shareholder and will receive £954,600.
Meanwhile, the firm’s executive management reportedly hold just six per cent of the stock, worth £154,800.
Unite assistant general secretary for manufacturing Steve Turner said: “We will now work with the Government and company to ensure that those workers who put their hands in their own pockets to support the company do not lose out.”
The Star has approached the firm’s Employee’s Benefit Trust for a comment on what it intends to do with its £799,800 share of the Government money.
As a limited company, Forgemasters’ shares were not listed for public sale or on a stock market. By buying all shares in the company, the MoD now complete ownership of the firm.