Proudfoot Consulting on Wednesday became the first international management consulting group in South Africa to sell equity to black economic empowerment (BEE) investors.
The group said transformational change in the South African economy and business environment has shown that direct empowerment through BEE ownership will provide a competitive advantage for international firms.
“We are proud to lead the way,” group chairperson Kevin Parry said in a statement, “and [we] look forward to sustained growth of the BEE company to generate greater success for our consulting business.”
The productivity consulting firm Proudfoot Consulting Africa (PCA) and broad-based empowerment groups Vuya! Investments and Chrims Investments have concluded an empowerment transaction in the local consulting sector.
In terms of the agreement, Vuya! Investments and Chrims Investments have acquired 51% of PCA for an undisclosed sum.
Effective shareholding for Vuya! Investments is 45% and for Chrims Investments 6%, making PCA a black-owned company.
Proudfoot South Africa, which is part of the Management Consulting Group plc, listed on the London Stock Exchange, retains a 49% shareholding.
The group added that the rationale for this empowerment transaction relates to clients’ requirements that PCA satisfy BEE criteria, as well as the increased likelihood of exclusion from future government and public sector work without appropriate BEE accreditation and broad-based ownership.
Proudfoot noted that it found Vuya! to be an extremely attractive investor as a broad-based empowerment group, with a very capable executive team and a track record in community development and job creation.
Parry said: “Proudfoot has been in business for more than 50 years and I am pleased that we continue to innovate in order to grow the business. In doing this deal, we are demonstrating a strong long-term commitment to the region.
“We have been actively looking for an empowered partner for some time who will play an active role in developing our business in South Africa. We firmly believe that the skills of our international management consulting firm matched with the credentials and contacts of our BEE partners will result in great success for all parties”.
Vuya chief executive Paula Huysamer said: “We are delighted to invest in an international management consulting firm. We believe in investing in companies with a strong market position that can add benefit to all aspects of South African business. PCA will be an asset to our portfolio of BEE investments.
“We look forward to actively promoting PCA to business and [the] government as we believe their strength in productivity consulting can add value to many organisations.”
Proudfoot Africa president Michael Boucher said PCA should gain considerable competitive advantage by aligning with BEE legislation strategy and by being the first global management consulting group and the first major consulting group in South Africa to sell equity to BEE investors.
Boucher added that as a black-owned company, there are substantial opportunities for the group. He anticipates that the highly qualified and professional Vuya! executive team with its proven track record will play an active role in the development of the business. — I-Net Bridge