Issuance of ZIM: Options in the amount of 10 m to the CEO – Capital Market

The shipping company Zim is preparing for an IPO in New York next week at a value of $ 1.8-2.2 billion, and the prospectus it released reveals how much money employees will earn “on paper” through the options given to them. While the total benefit to employees is estimated at about $ 80 million (before an additional bonus to be shared with ZIM), HamanAll of Eli Glickman alone will receive options worth close to $ 10 million.

According to the prospectus, in 2018 ZIM distributed options to employees amounting to approximately 5% of the company’s shares at the time, and as of the end of last September it was 4.9 million shares (the calculation takes into account the split of the shares prior to the IPO). Their average exercise price stands at a single dollar, while the mid-price range of the offering ($ 16-19 per share) is $ 17.5. That is, a benefit of about $ 16.5. The company employs 3,782 full-time employees, and of course the options are not evenly distributed among them, however On average, this is a benefit of about $ 21,000 that each employee will receive.

At the same time, Zim plans to distribute a cash bonus to employees in the amount of $ 8 million. Here too not everyone will enjoy it, but adding it to the equation will bring us a slightly higher profit (benefit + bonus) of About $ 23.5 thousand per employee.

As for Glickman’s CEO, the latter will receive NIS 9.6 million options to exercise at the issue price, his profit therefore depends on the upside of the share. , Another half a million shares will remain for distribution to employees, with the exercise price determined according to the average in the thirty days prior to the launch of the incentive program.

ZIM will issue 17.5 million shares to the New York Stock Exchange. The offering will be led by Citigroup, Goldman Sachs and Barclays, along with Jeffries and Norwegian investment bank Clarksons Platou Securities. Underwriters will be given a 30-day option to purchase 2.6 million shares of Zim.

The company’s estimates for the entire 2020 results predict revenue of about $ 4 billion, compared to $ 3.3 billion in 2019, and a profit of $ 500-525 million, compared to a loss of $ 13 million in 2019.

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