Kiewit Plans to Alter Status of Its Stock
By Steve Jordon, Omaha World-Herald, Neb.
Nov. 30–Peter Kiewit Sons’ Inc. of Omaha is changing its employee ownership status so that it would not have to file public financial reports with the Securities and Exchange Commission.
About 1,800 Kiewit employees own the company’s stock. Although the shares are not publicly traded and can’t be sold to outsiders, SEC rules state that companies with more than 500 stockholders must follow public reporting requirements.
Last month, Kiewit filed a plan that would transfer the company’s 19 million shares of stock to a new entity called the Peter Kiewit Sons’ Inc. Employee Ownership Plan, subject to approval by 80 percent of the employee-shareholders.
The shareholders would receive one unit of the ownership plan for each share of stock they had owned. The plan would be the company’s only shareholder, eliminating the reporting requirement.
In a filing with the SEC, Kiewit Chairman Ken Stinson said the plan was “a solution that gets us out of being a square peg in a round hole” — a privately owned business that must disclose information as if it were publicly traded.
While public companies seek capital from outsiders who should be informed about a company’s operations, he said, Kiewit’s shares are owned only by employees who are “very knowledgeable about our business.”
The reporting rules require Kiewit to disclose information that it considers “competitively sensitive,” he said, such as its income statement, construction backlog, profit margins and details about customers and projects.
Most Kiewit competitors don’t have the same reporting requirements, he said.
The filings also cost more than $1 million a year, he said, and take up management time and effort “that could be better spent improving our company performance.”
Stinson said the company would continue to provide financial information to employee-shareholders, and the change would not affect the value of the employees’ holdings, dividends, election of directors, taxes or other details.
The original plan exempted 21 employees of Kiewit’s Black Butte and Decker mining divisions and eight estate-planning trusts because, Stinson said, they technically are not shareholders.
Kiewit spokesman Kent Grisham said that the SEC, however, ruled that those shareholders also would have to be included in the plan.
As a result, a meeting scheduled to be held Wednesday for the vote on the stock-ownership plan was adjourned until Dec. 28.
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