§ Mr. Kenneth Clarke
The Government welcome the involvement of employees through employee share arrangements in buying shares in privatised companies at the time of flotation. We believe that this has been of considerable benefit both to the employees and the companies concerned. It is our intention therefore to make available the following special arrangements, for United Kingdom employees of the British Steel Corporation and its wholly owned subsidiaries:
- (i) employees will each be offered £70 worth of free shares plus a further £2 of shares for every year of service with the corporation. An employee with 15 years' service could therefore be eligible to receive, free of charge, £100 worth of shares;
- (ii) employees will also be offered 2 free shares for each one bought at the full share price on a matching basis, up to a maximum value in free shares of £330. An employee buying £165 worth of shares would thus receive shares worth in total £495;
- (iii) employees will be able to buy shares, up to a maximum value of £2,200, at a discount of 10 per cent. on the full share price;
- (iv) employees and BSC pensioners applying for shares at the full share price, will be treated on a priority basis over the general public, up to a limit of £10,000 worth of shares per individual.
The free and matching shares will be available to United Kingdom employees who satisfy certain minimum qualification periods on length of employment and hours worked per week. The discount and priority shares will be available to all United Kingdom employees. All these arrangements will be subject to an overall limit of 10 per cent. of the shares on offer in the flotation. The exact number of shares will be determined once the share price is decided.
§ Mr. Kenneth Clarke
The British Steel Bill currently before Parliament makes provision for the assets and liabilities of the British Steel Corporation to be transferred to a successor company. It is the Government's intention that the articles of that successor company should contain a provision which would restrict individual shareholdings in the company to a maximum of 15 per cent. of the equity. This provision would be protected by a "special share" in the company to be held by the Government. The arrangement would thus ensure that the successor company could not be taken over without the agreement of the Government as special shareholder.
It is the Government's intention that these arrangements would last for five years from the date of 384W privatisation. The special shareholder would have no other rights in respect of other provisions in the articles or in respect of voting.