Budget workers to benefit from Thomson float

Most of Budget Travel's 150 employees are expected to benefit from the imminent flotation of its British parent, Thomson Travel, which comes to the London market next week.

Thomson has announced that the great majority of the group's employees will be granted options over its shares, which are to be issued at £1.70 sterling. In addition, more than 5,000 of the group's employees have applied for shares and will each receive the full allocation subscribed for.

A spokeswoman for Thomson yesterday declined to state how many Irish employees had subscribed for shares, but added that around a third of the group's workforce had applied to purchase shares under the terms of the flotation.

Those who will receive shares at the issue price have already made an instant profit, on paper, with the shares rising to around £1.95p sterling on the unofficial grey market in London yesterday.

The issue price was higher than analysts' expectations and values the group at £1.7 billion sterling.

Such was the demand that Thomson had to increase the number of shares allotted to the public from the 10 per cent originally planned to 17 per cent to cater for more than 500,000 applications.

Analysts estimated that the offer was more than three times oversubscribed by the public. The 500,000 investors who subscribed will each receive a flat allocation of £500.

Irish investors were precluded from applying for the shares but some have made an application for the new issue through Irish stockbrokers. The demand for the shares from institutions has also been very strong. Employees could apply for share up to the value of 10 per cent of their salary. Shareholders will receive a 10 per cent discount on Thomson holidays as part of membership of a newly established Founders Club.

Thomson Travel is the UK's biggest holiday company. It purchased Budget Travel in 1996 for an estimated £10 million from the Granada Group. Budget Travel's joint managing directors, Ms Gillian Bowler and Mr Harry Sydner, also sold their 10 per cent stake to Thomson at that time but continue to run the Irish operations.

In 1997, Budget Travel generated £3.1 million of the group's £112.4 million profits.

Thomson sold 168,000 holidays in the Irish market last year, mainly through Budget Travel.