About the ESB ESOP
A 5% Employee Share Ownership Plan (ESOP) was a feature of the Cost and Competitiveness Review (CCR) agreed between the Government and ESB management and ESB Group of Unions in 1996. The ESOP is a tax efficient mechanism designed to allow employees of a company to acquire shares in that company or its parent company.
Eligibility for participation in the ESOP was established in accordance with the terms of the ESB ESOP trust deeds, the terms of which meet the requirements of the Taxes Consolidation Act 1997.
In 2001, an Electricity Act was passed which allowed ESB create capital stock for ESOP purposes thus enabling the 5% ESOP to be rolled out.
5% of the capital stock of ESB was set aside for purchase by the ESOP with the purchase financed by profits from the company. The ESOP was established in December 2001.
Contracts of Participation were issued to all those eligible to participate and in due course ESB shares were notionally allocated to all who entered in to those contracts.
The basic structure of the ESB ESOP contains two trusts as follows:
ESOT - Employee Share Ownership Trust
This is the trust which acquires the shares on behalf of the participants, holds them collectively and then passes them to the next trust to be distributed;
APSS - Approved Profit Sharing Scheme
This trust receives the shares from the ESOT and passes the shares on to the participants in a tax efficient manner.
The ESB ESOP is managed and administered by the Trustee, ESB ESOP Trustee Limited. The Trustee has a duty to act fairly and in the best interests of all participants. Information about the Board members of the Trustee can be found here.
How the ESOP works
acquires shares in the company on behalf of participants;
holds blocks of shares on behalf of participants and
transfers shares to the APSS.
receives shares from the ESOT;
appropriates shares to individual participants.
participants are then able to deal in shares on the internal market;
until sold, shares are held in the APSS.