Glenveagh Properties is proposing a large share options plan for its founding chief executive, Stephen Garvey, to ensure he remains on board and motivated as the home builder enters the next stage of its “ambitious growth journey”.
The Dublin-listed group plans to award Garvey a total of 11 million stock options next month in a one-off arrangement, it said in its annual report, published on Thursday. These will give him the right to buy shares within four to 10 years at set prices that average €3.75 – almost 90 per cent above current levels.
The options will be divided into five tranches that will vest within four to six years of being granted. Garvey would be able to buy the first batch of 2.2 million shares at €3.25 a piece and the last tranche at €4.25 each. The company’s stock would have to more double in value in the next decade for the all the options to have any real value.
“The proposed structure is strongly aligned with shareholder interests and supports the delivery of sustained value creation,” said co-founding chairman John Mulcahy in a shareholder circular, also issued on Thursday, in advance of the group’s annual general meeting (AGM) on May 15th.
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“This one-off grant reflects the critical importance of Glenveagh’s chief executive, Stephen Garvey, in delivering on the company’s long-term strategy, and the remuneration committee considers it to be a more disciplined and shareholder-aligned mechanism to ensuring the retention and continued motivation of Stephen than making a structural upward reset to his existing pay package.”
Garvey’s remuneration package soared 30 per cent to €3.55 million last year, driven by an increase in awards under a long-term incentive plan, the annual report disclosed. The company also plans to extend its normal executive incentive plan out to 2036, as the current one is due to expire in relation to new awards in September 2027.
Glenveagh’s operating profit rose 9 per cent last year to €144.1 million as revenues increased 7 per cent. The company delivered a total of 2,568 new homes, up 11 per cent on 2024. It aims to increase annual output to about 3,600 units by 2028.
Shares in the group rose by more than a fifth last year, though the advanced has slowed to 3.2 per cent so far this year, amid volatility over the past month as sector followers fretted about potential inflation and interest hikes resulting from the Iran war.
Garvey said last month that national housing output should reach 50,000 units by 2027 or 2028, up from 36,200 last year.
Mulcahy told shareholders in the circular that he plans to remain chairman for a further three years, notwithstanding the fact that he will be in the position for nine years in October. The Irish Stock Exchange’s Corporate Governance Code says that a chairperson should not remain in post beyond nine years from the date of their first appointment to the board.
Mulcahy said that other members of the board, led by senior independent director, Pat McCann, had unanimously decided that he continue for three more years, subject to a “comprehensive annual review” and re-election at each AGM.
“The board will undertake a formal and structured succession process, with my further term as chairman intended to support the company’s succession plan, allowing appropriate time to identify a suitable successor to lead the board and to facilitate and ensure an orderly succession to the role,” he said.
