Source: FT.com Financial Times, 2 July 2009
SAB Miller yesterday launched one of South Africa's biggest black empowerment deals, disclosing plans to sell a R6bn (£471m) chunk of its local subsidiary to employees, a charitable foundation and store owners who sell the group's products.
Graham Mackay, chief executive, said that 10 per cent of SAB Ltd would be given to these new black owners.
We are not just taking a group of high-profile figures. [This is being] directed at stakeholders
Mr Mackay added.
Since the end of apartheid, South Africa’s companies have come under pressure to comply with strict ownership quotas as well as other equal opportunities rules. More than R500bn of the country’s corporate wealth has been transferred to black businesses in dozens of deals.
But many empowerment transactions have simply transferred ownership to high-profile politically connected black individuals and have been criticised for bringing little benefit to the country’s black majority.
SAB Miller is offering 4 per cent of its South African subsidiary to its 9,000 local employees, of whom 80 per cent are black.
An equal proportion is being offered to owners of shebeens and drinks stores, although these will have to be either licensed or seeking a licence and – unlike employees – will make a small down-payment for their shares. A 2 per cent stake is being channelled to a foundation that will represent disadvantaged local communities.
SAB Ltd is not listed, but the shares will pay a dividend – dependent on local operating performance – and the paper is convertible after 10 years into SAB Miller equities. At current share prices, the shares would be equivalent to under 3 per cent of the overall group’s equity.
So-called vendor financing techniques mean the new black shareowner base will avoid the problems afflicting some other empowerment consortiums that have relied on bank loans to acquire corporate stakes.
Posted by