Pennine hands ownership of firm to staff

Medical manufacturer Pennine Healthcare has handed over ownership of the company to its workforce to help guarantee the firm’s long-term future in Derby.

Pennine Healthcare, which has operated in Derby for more than 50 years, has joined the growing band of forward-looking companies to set up an Employee Ownership Trust (EOT).

The privately-owned company has been sold to the EOT for an undisclosed sum that is below its market value to ensure maximum benefit for the employee shareholders moving forward. Advisers on the deal were Dains and Geldards.

The Trust, which represents the interests of the company’s 200 employees, now holds 100% of Pennine Healthcare’s shares.

All employees with at least 12 months’ service now have the opportunity to each receive up to £3,600 tax free dividends from annual net profits.

Pennine Healthcare, in London Road, specialises in manufacturing single-use, sterile medical devices and customised procedure packs for the NHS and the wider healthcare sector both in the UK and 80 countries worldwide.

The current operations board, led by chief executive Luke Fryer, will continue to manage the company, reporting to the EOT.

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Elizabeth Fothergill CBE, who is Lord Lieutenant of Derbyshire and whose father Ivor Shaw set up the company in the 1960s, has retired from the operations board to become a member of the EOT, which holds shares on behalf of the employees and will distribute the dividends equally.

She explained that the driving force behind the announcement was to ensure that Pennine Healthcare remained in Derby, recognised employees for their hard work and effort and retained capital in the business.

Mrs Fothergill said: “The success of Pennine Healthcare today is due to the skills and commitment of our employees and I am delighted that we have taken the EOT route to take the company to the next chapter.

“Selling the company to our employees through the EOT will ensure that Pennine Healthcare remains rooted in Derby and continues to create and retain skilled and valued jobs and careers for local people.

“Everyone will take an equal share of a significant proportion of net profits generated, which recognises the important part that each individual plays in the success of the company.

“Furthermore, this new structure enables investment in the company’s future in line with our long-held vision to be a world-class UK manufacture of healthcare products, serving global markets through exceptional customer service, innovation and continual improvement.”

Luke said: “We had been looking to sell the company to take it forward but decided that this was the best option for the future of Pennine Healthcare and our workforce.

“Establishing the EOT will enable the company to continue to operate in Derby and will pave the way for new product development and growth.

“The past year has been full of challenges due to the pandemic but everyone has stepped up to the mark to keep the NHS going.

“For example, we are the sole supplier of oxygen tubing to the NHS in England and pre-pandemic produced 3km a month of this product.

“In recent times, we have manufactured 20km of oxygen tubing a month, which has been so vital in treating Covid-19 and other clinically vulnerable patients.”