Omnia Managers And Employees Share In Shareholder Wealth
- Published: Friday, 12 December 2014 14:00
During the five year period from 1 April 2009 to 31 March 2014, Omnia generated wealth of R12.0 billion for shareholders, plus total dividends of R782 million while the Group market capitalization increased from R2.2 billion to R14.2 billion. Over this five year period, the Omnia share price increased fourfold from R52.00 to R211.05.
During this same five year period, the Omnia Board implemented two B-BBEE share ownership schemes, Sakhile 1, for over 2 000 South African employees and Sakhile 2, for a further 135 talented and skilled black South African executives and employees. Considerable wealth was created for these employees and the value of their combined interest at 31 March 2014 was R1.2 billion and at 30 November 2014 was R1.3 billion.
The Omnia Group also operated three performance based, long term incentive plans:
The Partner 4 Scheme for 190 middle managers and professional staff in South Africa. The total cash payment of R111.1 million was made in September 2014.
The Phantom “Share” Scheme for 46 selected senior managers and professional employees outside of South Africa. The total cash payment R48.4 million was also made in September 2014.
The Nanotron executive share scheme for twenty senior executives, which was approved by the non-executive directors of the Group on the remuneration committee, and by shareholders on 11 December 2009. The participants personally funded R10 million to subscribe for preference shares in Nanotron. Omnia Holdings Ltd had a call option to acquire at any time between 30 June 2014 and 31 December 2015 the ordinary and preference shares held by the executives participating in Nanotron. This was exercised on 30 November 2014.
The exercise price for the Nanotron scheme, determined according to the formula set out in the Circular approved by shareholders in 2009, is based on the 30 day volume-weighted average price (VWAP) of an Omnia Holdings Ltd ordinary share prior to the exercise date. Merchantec Capital, a JSE registered independent professional expert, has provided an opinion that the total exercise price is fair.
The total exercise price of the call option is R439.7 million and will be settled 50% in cash of R219.9 million and the balance of 50% by an issue of 1 043 527 new Omnia Holdings Ltd ordinary shares. The decision to settle 50% of the exercise price in cash was taken after feedback from various major institutional shareholders that the Group should seek to minimize any dilution effect on shareholders. As the Group has a low gearing, a strong balance sheet and available bank facilities, the Board deemed it in the interest of shareholders to settle 50% of the exercise in cash.
Omnia’s chairman, Neville Crosse, said, “The Omnia Board has long recognised the need for significant management and employee ownership participation within the Group. Omnia’s success is related to the excellence and long-term dedication of its people. We believe that an effective partnership between external shareholders, management and employees enhances performance and the ultimate wealth of the Group.”
He added that Omnia has followed a five year planning cycle with an associated five year Incentive Plan for the last two decades with management meeting or exceeding the long term targets set by the Board.
“The 1 April 2009 to 31 March 2014 cycle was successfully completed achieving cumulative compound real growth in earnings of 10.3% (equating to 16.1% nominal compound growth), exceeding the 8% target. During this period the Omnia share price increased fourfold from R52.00 to R211.05 and the market capitalisation rose 545% from R2.2 billion to R14.2 billion,” Crosse concluded.
Distributed by Brunswick on behalf of Omnia
For further information, please contact: Anne Dunn: 082 448 2684