from theBFD

The woke and dripping wet Stuff has apparently ‘gifted’ their staff of 900 a ten per cent stake in the company that was purchased for just one dollar. I think my headline has more truth to it than Stuff‘s own disingenuous but wonderful sounding headline.

When you read the article you find that the facts don’t really match the sizzle:

“Stuff owner and chief executive Sinead Boucher is gifting a 10 per cent share of the media firm to the company’s close to 900 staff.

“The stake in the company will be transferred to a trust controlled by employee representatives, rather than the shares being directly owned by staff members.

“The arrangement means staff would receive through the trust a share of any dividends Stuff pays out, and 10 per cent of the sale proceeds if Stuff was later sold or listed, she said.

“The gift means no staff will have to put any money into the company and they will not face any liabilities, including tax liabilities, as can apply with traditional share ownership schemes, she said.

“Employees would choose the trustees for the trust, who would decide how any proceeds were allocated, she said.

“The trust will be set up with the intention of giving all staff the benefit from that.

We will set the trust up, which will be the extent of my involvement in it,” she said.

“The 10 per cent stake in Stuff held by the trust will not come with voting rights.” –Stuff

If I were a staff member being bestowed this munificence, I’d be very closely perusing the trust deed.

The reality is very different from that claimed by the headline.

The staff won’t actually own the ten per cent of shares, the trust will. Without any details of the set-up of the trust that is a long way from individual staff “owning” ten per cent of the company.

There is no mention of what constitutes staff either. Is “staff” defined as those there at the valuation date? Will a new hire immediately become a beneficiary of the staff trust scheme?

The ten per cent stake in Stuff held by the trust will not come with voting rights. So they get a stake in any future profits, which given the current media market, is like betting on the meth-addled half-starved dog at the races. But they don’t get a say in how said company is run, despite theoretically “owning” ten per cent.

The BFD. Photoshop by Lushington Brady.

Now let’s put this all into perspective: in total, the staff would own ten per cent of the value of Stuff, which given it was purchased a year ago by Boucher for one dollar, is ten cents.  Divided by 900 staff, they each stand to gain 1 hundredth of a cent if it is sold for its original value.

Ownership also presumes one can sell said stake. I very much doubt that the staff stake could be sold, even for a dollar. 

It all seems rather messy and a rush job set up to look like the CEO has made progress on her nebulous promise. The reality is the “ownership” is still rather nebulous; the bottom line is that the company was bought for a lazy dollar, and there isn’t much in the way of news to suggest it is worth any more than that either.

If you take away all their government grants and subsidies you are still left with a moribund, dripping wet, woke organisation mired in a sunset industry still trying to pull the teat of a dead cow for the last drop of milk.

Sinead Boucher’s offer is an open book for very dumb people. Now watch them all fall for it.