Johannesburg - Vodacom employees, believing they have received a raw deal, are up in arms following the decision to push back the conversion date of stakes in the employee stock option programme (Esop) into shares in the company’s R7.5 billion YeboYethu empowerment scheme.
Last week YeboYethu shareholders voted to extend the notional funding period to October 8, 2018, allowing extra time to reduce debt. They also voted to amend the memorandum of incorporation to delay the conversion of N (non-voting) shares held in the Esop, into ordinary shares.
While Vodacom said all resolutions were passed with the requisite majority at the YeboYethu annual general meeting on Thursday, unionised employees said that “a saga is brewing”.
Richard Boorman, the spokesman for Vodacom, said yesterday: “I’m not going to comment on the Esop as this is an internal scheme.”
The YeboYethu board had not explained why the notional financing loan was not paid during the initial allocated seven-year period, only saying staff would be paid in 2019. Employees could access 40 percent of the dividend, which was taxable, said a staff member who spoke on condition of anonymity.
The Esop holds 45 percent of YeboYethu, which in turn holds 3.44 percent of Vodacom South Africa, but the scheme does not have access to the higher valued shares in the listed Vodacom Group. The latter holds 93 percent in Vodacom SA.
According to the 2013 annual report, the balance of the debt was R3.2bn after a R518 million notional dividend was received during the year.
The over 100 000 YeboYethu ordinary shareholders have received more than R4 a share in annual dividends since 2009, a year after the scheme was launched on July 30, 2008.
The Communication Workers Union, which represents Vodacom staff members who are protected under the bargaining unit, had called for the YeboYethu board to be dissolved, said Aubrey Tshabalala, the deputy chair of the provincial chapter.
“It seems like there are no funds,” Tshabalala said, adding that workers were also unhappy with discrepancies in the allocation of Esop shares, claiming that the arrangement did not empower lower-level employees. Also members of the scheme were unsure of how much they were entitled to, because the company did not make it clear how many units of the Esop were equivalent to one share in YeboYethu. Union members are set to discuss a way forward this week.
YeboYethu had offered 14.4 million shares at R25 each at a 10 percent discount to the R120bn value of Vodacom SA on launching to African, coloured, Chinese and Indian individuals, stokvel groups and black business partners.
Over-the-counter trading of the public YeboYethu shares was also postponed to next year to obtain approval from the Financial Services Board for online trading. “Trade via this platform will commence as of February 3, 2014,” Boorman said. - Business Report