Natfoods bosses accused of looting trust shares

National Foods Limited (NFL) workers have accused their management of 'looting' their trust shares amounting to 0,15% of the company's entire issued share capital.

According to the settlement on the National Foods Workers' Trust, NFL undertook to "give and donate, or procure the donation, to the trust from reserves of the group an initial sum of $1 600 000; in respect of each financial year commencing with that ending 31 March, 1984, a sum equal to 10% of the dividends, before withholding or other taxes thereon, declared and paid or due and payable by the parent company for each year".

But workers told NewsDay that the management clandestinely diluted the shares from 10% to 9,85% (approx. $34,8 million).

More so, the trust is reportedly now under the human resources department, something which is illegal. In wrestling the 0,15% shares from workers, the management allegedly victimised all trustee directors and is now trying to put people who do not "know the history of the company in positions of authority in as far as the management of the trust is concerned".

"The management stole 0,15% which they said they will fund the management share option scheme and it never existed. These guys want to blindfold the employees. They have taken the money and now they are targeting every employee with information concerning trust funds," the workers said.

"To date, we don't even know who is benefiting from the dividends meant for workers. As employees we need all the dividends and 0,15% to be paid from 2008 to date. We are calling for management to cease the withholding of workers' trust funds into National Foods treasury," they said.

But NFL chief executive officer, Mike Lashbrook dismissed the allegations as incorrect and without merit.

He said the NFL worker's trust was an independent body managed by a board of trustees, which includes employee and employer representatives (in equal numbers) as well as an independent chairperson.

"Management of NFL does not have authority over the trust and it is important to note that the trust is managed by its trustees and is not run by a department of NFL," Lashbrook said.

Lashbrook said 10 years ago, the workers' trust was diluted from 10% to 9.85% as a result of new share issues by NFL.

"When new shares are issued in any company existing shareholders are diluted, this is standard practise and there is nothing sinister about the worker's trust share dilution," he said.

"The worker's trust earns its share of the dividends that National Foods pays and given that NFL can continue to perform strongly is potentially a wonderful tool to uplift the lives of the National Foods team."

Lashbrook said the trust was created many years ago through the issuing of new shares in the company by the shareholders at that time, meaning that they effectively diluted their stakes to facilitate worker participation.

"It benefits all National Foods employees with the exception of senior management," he said.