Ramco criticised over share option swap deal
DIRECTORS of oil exploration group Ramco Energy, including former
defence secretary Sir Malcolm Rifkind, have come under fire for proposing share
options which will allow them to ''shift the goal posts'', despite a collapse
in the share price.
Manifest, an independent voting agency, has warned shareholders
that a proposed motion at next month's annual meeting will allow directors to
replace options whose exercise price is above the current share price with
lucrative alternatives.
Ramco shares have fallen from 792½p to335p this year, but
Manifest claims that proposals for a new option scheme would allow
directors to determine their own rewards. Non-executive directors, including
Sir Malcolm, who sit on the remuneration committee are unusually included in
the proposed option scheme.
Ramco "was also criticised for not splitting the role of chairman and
chief executive, and granting directors two or three-year contracts, rather
than the one-year recommended by corporate governance codes.
The company refused to say at what level future share options could be
exercised, and pointed out that shareholders still have the right to vote
against the plan if they are concerned.
A Ramco spokeswoman added: "The existing share options have expired and
need to be replaced. They not only affect directors but also other salaried
staff. Most people understand that the share prices of E&P [oil exploration
and production] companies go through fluctuations that do not always reflect
the company's performance."
Daily Telegraph
28th May 1999
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