Carphone Warehouse founders pledge 5m shares to managers
Friday 26 December 2003
Charles Dunstone and David Ross, founders of the Carphone Warehouse retail chain, are giving 5 million shares to their senior employees as part of a new incentive scheme.
About 40 managers at the company employed below board level will benefit from the gifts that are worth an average of £176,250. However, the company said different managers would get different-sized gifts.
The company has also put in place a new three-year share option scheme for its 500 store managers.
The 5 million shares being given away are conditional on the recipients being employed by the company on 1 October 2006. Although the gift of shares will create an income tax liability, the company has agreed to lend managers the money to deal with the tax bill when it arises.
A spokesman said: "When the company floated in 2000 everybody got shares through the company's save as you earn scheme. People have grown up with their jobs and rather than at the top level doing something with share options, the company decided to just give people shares."
Mr Dunstone, the chief executive of Carphone Warehouse, is contributing 2.5 million shares. Mr Ross, the deputy chairman, is giving away 1.75 million. The balance of 750,000 shares is being given by Guy Johnstone, another founder who has since left the company. After the gift, Mr Dunstone will still own 306.5 million shares in the company, equal to 35.1 per cent of its issued capital. Mr Ross owns 214.8 million shares, or 24.6 per cent.
The gifts partly reflect the success of the company over the past year but will also help incentivise top managers over the coming 12 months. Next year should see the introduction of third generation mobile services. These are expected to prompt a buying spree of handsets equipped to deliver the services, which include live video phone links and more powerful computer download capacity.
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