pounds 40m 'on tap' for Southern workers

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The Independent Online

Industrial Correspondent

Employees at Southern Electric will make an estimated pounds 40m profit from the staff Sharesave Scheme if the proposed pounds 2.8bn takeover of the company by National Power goes ahead.

The National Power offer document, issued yesterday, shows that although the scheme is yet to mature, the 2,600 participants will be able to buy millions of Southern shares - mostly at pounds 1.75 - and take advantage of the National Power pounds 10.10 offer price.

The company refuses to reveal how they expect to treat Southern Electric executive share options if the takeover goes ahead, but it is expected that four directors of the regional firm could make about pounds 1m from shares and exercising options, further fuelling the row over fat cats.

Yesterday, unions added their voice to the debate over boardroom excess, lobbying a North West Water meeting in Manchester under the banner: "Public service not private sleaze". Members of Unison dressed as the "cats" called on North West shareholders to reject the planned pounds 1.8bn takeover by Norweb. They claim thousands of jobs will be lost and customers will lose out if it goes ahead.

National Power's offer document also confirmed that the company plans to sell pounds 1bn worth of its power stations by the end of next March, with Eastern Group, recently acquired by Hanson, among the front-runners to buy the plant. The company hopes the sale of stations will help to defuse fears over concentration of power in the electricity industry.

It has also emerged that, if the National Power bid succeeds, the banks and other organisations advising National Power will receive about pounds 30m in fees.

The takeovers by National Power and North West Water are still subject to regulatory approval. Ian Lang, President of the Board of Trade, is yet to decide whether these bids - and that made by PowerGen for Midlands Electricity - should be referred to the Monopolies and Mergers Commission.

In spite of City criticism that North West's pounds 1.8bn offer is "overpriced", the company gained approval from shareholders at yesterday's EGM and confirmed that it already owns 29.52 per cent of Norweb.