Tesco Chief Executive Officer Dave Lewis bought about £200,000 ($306,000) of the UK supermarket operator’s shares, a day after he said he was restricted from doing so.
Lewis, who also serves on the company’s board, bought 99,950 shares at 200.1 pence apiece, Britain’s largest retailer said in a statement Thursday. The purchase is the CEO’s first since he started in the job just over a year ago, excluding shares awarded to him as part of his pay package.
Lewis said at a press conference presenting Tesco’s first- half results on Wednesday that board members had prohibited themselves from trading in the company’s stock because they were in the midst of a business review and in possession of “considerable inside information.” Lewis’s share purchase came after the conclusion of that review, a spokesman said.
“Shareholders will appreciate the probity of their approach, but it may have been helpful for them to know at the outset that this was their policy,” said Sarah Wilson, chief executive officer of Manifest, a corporate-governance adviser. “It’s unusual.”
In addition to Lewis’s purchase, Chief Financial Officer Alan Stewart bought 50,000 shares, and Chairman John Allan bought 50,891 shares. Tesco’s governance policy states that Lewis must hold shares with a total value of four times his 1.25 million pound salary within five years and Stewart must hold shares worth three times his 750,000 pound salary.
The purchases come as Tesco’s governance practices are under a microscope. It remains under investigation by the Serious Fraud Office after the company said in September last year that it had overstated profit by 263 million pounds. Lewis said Tesco continues to cooperate with the probe.
News by Bloomberg, edited by ESM. To subscribe to ESM: The European Supermarket Magazine, click here.
