29 Own shares held by Employee Benefit Trust
The own shares reserve forms part of retained earnings and represents the cost of shares in Spectris plc purchased in the market and held by the Spectris plc Employee Benefit Trust (“EBT”) to satisfy options under the group’s share option schemes (see Note 27).
| 2007 £m |
2006 £m |
|||
| Balance at 1 January | 0.3 | 5.0 | ||
| Disposals | (0.1) | (4.7) | ||
| At 31 December | 0.2 | 0.3 |
The EBT holds ordinary 5p shares in Spectris plc for the purpose of satisfying obligations under the 1996 Executive Share Option Plan for the benefit of the group’s employees. The EBT held 20,780 shares at 31 December 2007 (2006: 0.1 million) at a cost of £0.2m (2006: £0.3m). The market value of the EBT’s shares at 31 December 2007 was £0.1m (2006: £0.5m).
The purchase of the shares on the open market is funded by loans directly from Spectris plc. Dividend income in excess of 0.01p per share on the shares held by the EBT has been waived by the Trust and is therefore not included in the group’s profit and loss account. Interest and administration costs of the EBT are charged to the profit and loss account of the company for the year.