JSW Group on Monday announced around 16 million shares worth about Rs 1,000 crore in a comprehensive employee stock option plan (Esop) to reward employees of its steel and energy business.
The Esop opportunity, payable at a face value of Re 1 per share to the blue-collar and white-collar employees. Most manufacturing firms generally give Esops to their mid-and senior-level employees, leaving out blue-collar workers from the benefit.
JSW Energy and JSW Steel have rolled out Esops for 16,000 employees, offering over 16 million shares, the company said in a statement.
Dilip Pattanayak, president, human resources, JSW Group, said, “While employees get ownership interest in the company through Esops, companies save cash by rewarding employees with stocks. As part of the program, the firm sets up a trust fund wherein it either contributes new shares or cash for buying existing shares,”
“It will cover all employees of the steel and energy unit, from the shop-floor employee to the middle level to top management. At the current market value, this is over Rs. 1,000 crore wealth-generation initiative,” he added.
Dilip Pattanayak said, “JSW plans to run the programme through its employee welfare trust, which will procure shares from the secondary market and allocate them to the employees on the days of vesting and exercise by the employees. The plan was approved by its board and shareholders at the annual general meeting,”
“Since we are doing a secondary market purchase, there is no dilution to the existing share pattern. So I do not see any concern from our retail shareholders,” said Pattanayak.
“ESOPs will be vested over a period of four years wherein 25% each will be vested after the first and second year and the rest after the fourth year,” he said.
“We have the approval to go ahead with the plans for 1.30 crore shares in JSW Steel and 32 lakh shares in JSW Energy. This corresponds to 0.54% of our paid-up equity in JSW Steel and 0.20% of our paid-up equity in JSW Energy,” added Pattanayak.
