Poundland boss Kevin O’Byrne has been offered a £2.7m share package to remain in charge under the ownership of Steinhoff.
The value retailer is the subject of an improved £610.4m offer from the South African retail conglomerate – which already owns Harveys and Bensons for Beds in the UK – sparking suggestions that newly appointed boss Byrne could leave the business.
Poundland shareholders will vote on the acquisition next month, leaving O’Byrne’s future uncertain.
The former B&Q boss only took the reins from Jim McCarthy earlier this year and some analysts have suggested he may prefer to look for opportunities at another listed business.
But Steinhoff, which upped its bid for Poundland by 5p a share after activist investor Elliott Capital Advisors built its shareholding and threatened to scupper the acquisition, has moved to try and retain O’Byrne’s services ahead of the vote on September 7.
The final details of Steinhoff’s offer were sent to shareholders on Friday. The documentation reveals that O’Byrne will be handed Steinhoff shares equivalent to four and a half times his £600,000 salary if he remains with the company for three years from November and meets performance targets.
If O’Byrne departs before November, he will be granted a cash payment equal to 55% of the share award, reduced pro-rata by the amount of time he has spent in the job.
Even if O’Byrne does exit Poundland, he stands to collect around £772,000 by selling the 600,000 shares he purchased in the business at 179p each in March.
Steinhoff’s bid values the shares at 227p, meaning O’Byrne has made a profit of about £154,000 in just a matter of months.
His predecessor McCarthy is poised to cash in more than £22.7m from the sale of his stake.