Premier Foods, the company at the centre of the Sudan dye food scare, has launched a sharesave scheme following its full listing on the London Stock Exchange. The food manufacturer, which owns the Branston Pickle and Typhoo Tea brands, floated in July to pay off its debts and acquire more brands. And last month, it introduced the sharesave scheme to allow all employees with six months’ service to buy shares at a discounted price.
Personnel manager Malcolm Orbell said: "It gives employees the opportunity to save over a period of time and an option to buy shares without any risk at the end of the time." But he added that the scheme would not help retention.
"I don’t think the gains are going to be significant enough for someone to decide that they want to stay in employment just for share options – people leave for lots of other reasons. I wouldn’t say retention is a particularly important reason [to launch the sharesave plan]. "At the end of the day staff can have their money back if they resign so they don’t lose what they save," said Orbell. A number of incidents have affected Premier Foods over the last twelve months. As well as a fire at a major plant in Bury St Edmunds, the firm had to remove a number of its products from sale, such as its Loyd Grossman sweet and sour sauce, after becoming contaminated with the illegal scarlet red dye Sudan 1.
However, despite this, shares in the company have been on the rise since flotation, significantly outperforming the FTSE 250. "[The share price] has not been changing much over the last couple of months, but it’s got the 20% discount on it – and who knows what the share price will be in three years’ time," added Orbell.