Business / Companies
Ben Magara awarded shares worth R11 million by Lonmin
12 Jul 2013 at 05:21hrs | Views
LONMIN's Zimbabwean CEO Ben Magara has been awarded 230,604 shares - worth about R11m at the current share price of R42 - to compensate him for the loss of various financial incentives meant to encourage him to stay with his previous employer, Anglo American Platinum (Amplats).
The financial incentive for Mr Magara to succeed with his turn-around strategy at the troubled platinum group is huge.
Doubling the share price to R80 would increase the value of his equity stake to about R22m.
A statement released by Lonmin on the JSE's SENS reads: "Pursuant to DTR 3.1.4 R, Lonmin Plc confirms that the following awards were today granted to Ben Magara, who joined the Board as Chief Executive Officer on 1 July 2013.
- A nil cost award under the Company's Long Term Incentive Plan for 130,302 shares with normal vesting on the third anniversary of the date of grant.
The LTIP Award is wholly subject to the satisfaction of a performance condition comprising:
- the measurement of sustained and broad-based operational performance using the Company's Balanced Scorecard averaged over three years; and
- the Company's Total Shareholder Return over a three year period relative to the median of a group comprising the Company's five direct peers producing Platinum Group Metals.
The operational targets support the delivery of the company's medium and long-term term targets. The methodology of the performance condition is explained more fully in the remuneration report in the 2012 annual report.
- A Retention Award for 130,302 shares which will vest, subject to continued service, in three equal installments on 31 May 2014, 31 May 2015 and 31 May 2016. This award utilises the provisions of LR 9.4.2R."
Mr Magara - a highly experienced and respected mining engineer who had spent his entire career working for Anglo American - joined Lonmin on July 1 after leaving Amplats, where he had been overlooked for the position of CEO.
According to a statement from Lonmin, it believes using shares will significantly Maraga's alignment with shareholder's ineters, "we believe that by using Lonmin shares, rather than cash, to deliver this buyout of Mr Magara's Anglo lock-ins, we significantly boost his alignment with shareholders' interests. He has also agreed to make a personal shareholding with a value of three times his salary within three years of joining, rather than the five years our policy currently targets, to further boost that alignment."
The financial incentive for Mr Magara to succeed with his turn-around strategy at the troubled platinum group is huge.
Doubling the share price to R80 would increase the value of his equity stake to about R22m.
A statement released by Lonmin on the JSE's SENS reads: "Pursuant to DTR 3.1.4 R, Lonmin Plc confirms that the following awards were today granted to Ben Magara, who joined the Board as Chief Executive Officer on 1 July 2013.
- A nil cost award under the Company's Long Term Incentive Plan for 130,302 shares with normal vesting on the third anniversary of the date of grant.
The LTIP Award is wholly subject to the satisfaction of a performance condition comprising:
- the Company's Total Shareholder Return over a three year period relative to the median of a group comprising the Company's five direct peers producing Platinum Group Metals.
The operational targets support the delivery of the company's medium and long-term term targets. The methodology of the performance condition is explained more fully in the remuneration report in the 2012 annual report.
- A Retention Award for 130,302 shares which will vest, subject to continued service, in three equal installments on 31 May 2014, 31 May 2015 and 31 May 2016. This award utilises the provisions of LR 9.4.2R."
Mr Magara - a highly experienced and respected mining engineer who had spent his entire career working for Anglo American - joined Lonmin on July 1 after leaving Amplats, where he had been overlooked for the position of CEO.
According to a statement from Lonmin, it believes using shares will significantly Maraga's alignment with shareholder's ineters, "we believe that by using Lonmin shares, rather than cash, to deliver this buyout of Mr Magara's Anglo lock-ins, we significantly boost his alignment with shareholders' interests. He has also agreed to make a personal shareholding with a value of three times his salary within three years of joining, rather than the five years our policy currently targets, to further boost that alignment."
Source - business
