THOUSANDS of shopworkers are to share in a multi-million pound windfall after Scottish high street footwear chain Schuh was bought by an American retail giant.
The overjoyed employees – from assistants and warehouse workers to managers – will be handed more than £37 million following a £125m takeover deal between the company and Tennessee firm Genesco.
Staff at Schuh’s headquarters in Livingston and at shops around the country including Glasgow and Edinburgh were stunned as they learned that they will receive a bonus worth thousands of pounds as a reward for their “hard work and dedication”, with some payouts expected to be equivalent to more than a year’s salary.
The deal, one of the biggest corporate windfalls in Scottish history, means Schuh’s managing director Colin Temple and finance director Mark Crutchley will be in line for payments of £25m each if the company meets its targets in the coming years.
It will also safeguard thousands of jobs as the new owners have promised the takeover will herald the start of a major expansion into Europe.
It is understood the payouts to 2310 staff at the headquarters and 59 stores will be based on length of service.
The terms will see a worker who has been with the retailer for four years in line to receive a lump sum worth 110% of their annual wage.
Mr Temple said: “We like to think of the money as the value that was in the business that had accumulated over the last 30 years, that’s why we wanted to pass it on to the staff.”
The news of the takeover broke early in the day, and slowly filtered out to staff in stores in Glasgow, Edinburgh, Newcastle and London.
One insider said that few people knew exactly what they would receive in their pay packets as the details were yet to be worked out, but word had quickly gone round the firm’s headquarters that “something special was in the air”.
He added: “I’ve never seen anything like it. It’s a win-win situation for everybody. When the announcement went out there were a lot of stunned faces – then there was a lot of cheering.
“There’s a party arranged to celebrate Schuh’s 30th birthday in Edinburgh. I think that’s going to be a bit special now.”
Schuh was started in Edinburgh in 1981 by businessman Sandy Alexander and has grown to become a familiar name in shopping centres with an annual turnover of around £140m.
The business is currently in a strong position, but had gone into receivership in 1990 after its parent company Goldbergs went bust.
It had to be rescued by its board of directors, who all invested their own money in the firm. That foresight and belief in the company now means that those who kept their money in the company will reap huge dividends.
Under the terms of the deal Schuh’s operating debt of £29m will be wiped out while a total of £37.3m will be given to staff.
Around £7m will be used to set up a charitable foundation dedicated to good causes chosen by Schuh employees.
Mr Temple explained that the takeover was the result of months of negotiation, adding: “We were approached by an American company around Christmas last year.
“As a business we were not naive about these things, we were always quite open to talking to other firms. It sounds a bit soft and cosy but we really liked them and it just felt right to us.
“The relationship ticks the majority of boxes for us. We’re planning to continue to grow the Schuh business in the UK, just at a faster pace now.”
Robert Dennis, chairman, president and chief executive officer of Genesco, which has 2285 stores in the US and Canada, said: “Schuh provides us with an immediate and established retail presence in the United Kingdom, a highly experienced international management team, and improved insight into global fashion trends.”
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