AltX-listed food company All Joy’s deal with the National Empowerment Fund (NEF), whereby 8,33-million shares in All Joy were bought by the fund, will help beef up the company’s empowerment status while improving the share liquidity, as it will allow ordinary people to own 26% in the group, CEO and chairperson Marci Pather said on Tuesday.
Prior to the deal, 31% of the stake in All Joy was already in the hands of black economic empowerment (BEE) entities and individuals.
Speaking at the recapitalisation transaction announcement where the NEF injected R5-million in return for a 19,9% stake, Pather said All Joy had waited for five years to strike a meaningful BEE deal with a suitable partner.
Following the transaction, the company has 42-million shares in issue, which is eight million shares less that the total number of shares All Joy is able to issue. Pather said the company is currently not looking at applying for an increase in authorised share capital.
“Through this deal, All Joy will be able to advance to the next level in terms of expansion, and this includes possible acquisitions and other growth opportunities,” he added.
Although the deal is not subject to a lock-in period, NEF acting chief investments officer Para Naidoo said the state-owned entity is entering into a long-term relationship with All Joy and on that basis will be disposing of its newly acquired shares in a managed manner.
Following the acquisition, the NEF is entitled to sell any amount of its shares in the food company to anyone, but has committed itself to giving preference to BEE entities and historically disadvantaged individuals.
Naidoo said the fund is not planning to help fund those individuals wanting to buy shares it has acquired under this transaction, as this would be tantamount to going against the culture of saving.
Minister of Trade and Industry Mandisi Mpahlwa and Director General of Trade and Industry Alistair Ruiters were scheduled to give key speeches on Tuesday but were unable to attend the function due to a Cabinet lekgotla (meeting) commitment.
NEF acting CEO Nchakha Moloi, also absent due to the lekgotla, has been at the fund’s helm for about five months following former CEO Sydney Maree’s resignation. The state-owned entity expects to replace Maree during the first half of 2005. — I-Net Bridge