By Robert Head
A big personal worry hangs over 150 top executives in British Leyland — apart from their other problems. They stand to lose an average of nearly £11,000 each , especially if they quit their jobs with the ailing motor giant.
In chairman Lord Stokes case the loss could be £82,000 The bosses bought thousands of British Leyland shares under a special incentive scheme set up some years ago. They put down a tiny cash deposit. After three years the company has the right to make them pay up the rest of the
money , more so if they quit the firm for a better job.
Trouble is that British Leyland shares have crashed from around 35p to under 8p since the boss’s got their shares. Under the rules of the scheme the least the company could make each man pay for his shares now is 25p each the nominal value. But since the shares are now only about 8p on the Stock Exchange, anyone asked to pay up now would stand to lose 17p on every share.
The 150 bosses own a total of 9,668,000. Lord Stokes owns 485,437 incentive shares. One executive, who has a big block of these shares, told me:
“I am very worried about it.”
It means that the top men are virtually trapped not only in a much troubled motor industry but also in a company which has had to go to the Government for cash help. Their “golden handshakes” are turning out to be 150 pairs of golden handcuffs. Some legal experts believe that the directors need not insist on anyone stumping up the cash for his incentive shares.
But others say they must call in the money, especially now that British Leyland needs all the cash it can get. That could mean the 150 top men dipping into their pockets or bank overdrafts for a frightening total of £2,300,000. Some people in the company believe that anyone who deserted the ship for a better ,job elsewhere should certainly be made to pay up in full.
Government officials who will be responsible for putting taxpayers money into British Leyland seem likely to feel that way too.