Thebe Mabanga
Black Economic Empowerment is on the road to recovery and what is hoped to be a new phase of spreading benefits more equitably with the help of the state, according to BusinessMap Foundation’s review Empowerment 2002: The State Steps In.
Measures that the government has taken to aid empowerment include the introduction of a minerals Bill in the mining sector, an empowerment charter in the energy sector and more rigorously defined empowerment criteria for empowerment ownership for the second national operator in telecommunications.
According to the report, empowerment deals last year for which amounts were disclosed totalled R3,82-billion, a 53% increase on the ebb of R2,5-billion in 2000 but still significantly far from the R21-billion peak of 1998.
The mining sector continued to dominate as the biggest deal provider, followed by financial services, oil and energy, power and defence. The former favourite flavour of the consortiums telecommunications and information technology trailed them all.
Mining accounted for five of the top 10 empowerment transactions, led by Patrice Motsepe’s African Rainbow Minerals’s contribution of R1,1-billion to a joint venture with Harmony Gold to acquire Anglo American’s gold assets in the Free State.
The deal was valued at R2,2-billion. The financial services sector showed acquisitions of R714-million, a marginal increase from 2000.
The energy sector, which has a charter undertaking to transfer 25% ownership to black hands by 2010, started with significant strides. A major deal in the sector was the acquisition by Thebe investments of 17,5% of Shell Marketing for R300-million.
The telecommunications sector suffered a heavy knock from the economic slump and the events of September 11. Deals recorded in this sector fell from R355-million to a depressing R72-million. This year telecoms players hope to benefit from a 19% empowerment stake in the second national operator.
On the bourse, black economic empowerment companies continue to struggle. At the end of February black-controlled companies accounted for 2,2% of total market capitalisation, down from 4,8% a year ago.