At $100 per share, the British Telecom bid is some $15 more than the highest price its Norwegian rival, Telenor, was prepared to pay for Esat Telecom. That extra $15 per share adds another $43 million (£33 million) to what Esat chairman and chief executive Denis O'Brien will get for his stake in the company.
Mr O'Brien will get $287 million (£221 million) for his 14.5 per cent of the company he set up in 1991. And he will make a profit of about £10 million on the share options, granted in November, that he is expected to exercise as part of the BT deal.
But he is not the only winner. Esat directors and the management team own shares and hold valuable options to acquire shares.
And Esat employees who took up the opportunity to acquire the share options on offer as part of their terms and conditions of employment will benefit. They can now buy Esat shares at significantly lower prices than the $100 BT offer price and then sell the shares for $100 each.
Since November 1997, employees who have completed a six-month probationary period have had the opportunity to acquire options. Some 80 per cent of the employees took up this opportunity. The company declined to give a breakdown of the option prices involved.
Among those set to make significant gains from the sale to BT are directors Mr Mark Roden, Mr Paul Connolly, Mr Leslie Buckley, Mr Sean Corkery, Mr Neil Parkinson, Mr Padraig O hUiginn and Ms Lucy Gaffney.
Among these directors, the largest holdings of shares and options belongs to Mr Roden. His holding of shares and options is now worth some £7.3 million. When the cost of exercising his options is deducted, he stands to make a taxable gain of some £6.9 million following the BT deal.
A director and consultant to Esat, Mr Roden set up the company with Mr O'Brien in 1991. He started as director of sales and marketing and became chief executive of Esat Telecom International in 1996. He left his full-time Esat position in 1997 to set up Torc Telecom, which provides prepaid card telecom services.
Mr Connolly, an accountant who has been a director of Esat since 1996 and has his own corporate finance consultancy company, has shares and options now worth some £7.2 million. His gain after deducting the cost of exercising his options will be about £6.7 million.
The BT deal values Mr Buckley's Esat shares and share options at just over $8 million or £6.3 million. His gain before tax, when the cost of exercising his options is deducted, will be about £5.7 million. A director since 1996, he was acting chief operations officer of Esat from late 1996 to December 1997. He is well known in business circles as the company doctor, who advised companies such as Waterford Crystal, Aer Lingus and Irish Steel on major restructurings. With 73,825 US shares and options, Esat outgoing chief operations officer Mr Corkery has a holding worth some $7.4 million or £5.7 million. The cost of exercising these options was not available - this will reduce his total profits on the sale of his shares. He came to Esat from AST Computers, where he was head of European operations.
Mr Parkinson, who has been Esat chief financial officer since November 1996, will get just under $7 million (£5.3 million) for his shares/options - less the cost of exercising the options, which was not available yesterday.
Mr O hUiginn, a former secretary-general of the Department of An Taoiseach and currently a director of the Irish Tourist Board, has shares and options worth £3.75 million. His profit, if he exercised his options and sold all his shares, would be about £3.5 million.
Ms Lucy Gaffney, the Esat Telecom chief operating officer designate, who has been managing director of Esat Clear since July 1998 and had her own marketing consultancy before joining Esat in November 1997, owns shares and options now worth $4.7 million (£3.6 million). No exercise price for her options was available.
Another founding Esat Telecom director, the business consultant and former executive chairman of Bord Isacaigh Mhara, Mr Brendan O'Kelly, has shares and options now worth $3.4 million (£2.6 million). He will make a profit of about £2.3 million after he exercises his options and sells his shares.
The family of the chairman and chief executive also stand to gain. Mr Denis O'Brien senior, the father of Mr O'Brien, stands to make a profit of about £3.5 million from his shares and options. Mr O'Brien senior was a founding director of Esat Telecom.
Another beneficiary will be First Active chairman and former KMPG managing partner Mr John Callaghan, who has been a director of Esat since December 1996. He stands to gain about £2 million before tax. Last May, Mr Callaghan sold some 10,000 Esat ADS shares for $43 per share.
The recommended bid is well in excess of the opening salvo in the recent bidding battle for Esat. The first offer, $72 cash per share, came from Newtel - the merged company formed by Scandinavian telecom groups Telia and Telenor, which later broke up. Following the break-up, Telenor continued to bid for Esat raising its offer to $85 per share.
