Empowerment is a business imperative that South African companies need to embark upon as black economic empowerment (BEE) accreditation will allow them to maintain their existing positions, executive chairman of industrial group Bidvest (BVT) Brian Joffe said on Monday.
Earlier on Monday, about 79% of Bidvest shareholders approved the group’s R2,1-billion BEE deal with the Dinatla consortium. However, there was one major dissenting Bidvest shareholder that voted against the deal, Joffe said.
The Dinatla consortium will take a 15% stake in Bidvest or 45-million shares with the R2,1-billion deal being financed for three years by Bidvest shareholders, after which it may be refinanced, Joffe added. The consortium will initially contribute five to R10-million toward the costs of the transaction.
“Empowerment is about transformation, job creation and enterprise development,” said Tania Slabbert from Dinatla Investment Holdings. Dinatla has partners from all nine of South Africa’s provinces and the consortium was formed just prior to July 2003.
“This empowerment deal is one of the greatest steps by an industrial company with the full cooperation of the Bidvest board,” Joffe said.
As part of the deal, members of the Dinatla consortium had to sign restraint of trade agreements prohibiting them from entering into ventures that would compete with Bidvest group businesses.
Following the approval of the transaction by Bidvest’s shareholders the scheme of arrangement is now only subject to the sanction of the high court. The Bidvest BEE strategy is to deliver true BEE influence in line with South Africa’s Department of Trade and Industry strategy for broad-based black economic empowerment.
As a result of the deal, Bidvest is positioned for improved participation in private and public opportunities, providing an enhanced growth platform, the company said in a statement. – I-Net Bridge