Just as well City institutions have no shares in Urenco, the nuclear enrichment company that makes the fuel for nuclear power stations and the raw material for atomic bombs. It’s owned by the British and Dutch governments and two German power companies. The annual report reveals that it has shown a largesse towards its former chief executive that would be frowned on in even the most lax City boardroom. Helmut Engelbrecht, 63, stepped down in December. He received €5.9m (£4.6m) in his final year, including a one-off pension payment worth €2.8m. That was on top of the €6.3m pot he has already amassed in the company pension scheme. The unusual payment was the result of a 2005 employment contract, which gave Engelbrecht the right “to receive a certain income as retirement benefit which would be payable under certain conditions”. Those conditions were obviously met, as the payment was made, but Urenco won’t say what they were. This is surprising: all the other performance conditions for pay — for the executive share scheme and bonuses — are disclosed as normal in the report. I suspect the sole condition was that he stayed in the job — in other words, it was the kind of golden handcuffs deal the Weir shareholders kicked out. Urenco says an independent actuary valued the deal at that €2.8m figure. That suggests Engelbrecht is being paid an annual sum until his death. My friendly actuary reckons €2.8m would buy you an annuity of €103,000 a year. That’s not the end of Engelbrecht’s payments. He will get €500,000 over the next three years for advising the company. It seems that when it comes to rewarding its former chief executive, Urenco’s directors have taken the company’s motto — “Enriching the future” — to heart.
Sunday Times 1st May 2016 read more »