Distell Group, South Africa’s largest listed wine and spirits producer, will be unveiling details of its long-awaited black economic empowerment (BEE) transaction on Wednesday September 21, the company said on Friday.
In a statement, Distell said it will be making an announcement together with its partners on the broad-based empowerment initiative at its Nederberg cellar in Paarl.
“Distell’s commitment to BEE flows from our aspiration to succeed as a truly great South African company,” MD Jan Scannell noted. “The transaction we will announce on Wednesday is core to this ambition.”
The structuring of the BEE deal has apparently been a complicated process.
Approximately 90% of Distell’s equity is tightly held between brewing giant SABMiller, industrial group Remgro and KWV Investments, all with equal 30% stakes in the company, although Remgro and KWV Investments hold their stakes in a joint structure. The remaining 10% of Distell’s shares are freely floating.
At the company’s interim results presentation in February, Scannell said that all three shareholders had come to an agreement on how the BEE transaction could be structured, which revolved around creating a shareholding structure that was outside the current structure. All three companies would be equally affected by the transaction.
“We have had a positive reaction from our shareholders and we hope to conclude an empowerment transaction within the next few months,” he said at the time. “We basically have shareholders’ agreement and it is a priority for us.”
Currently, Distell management estimates BEE shareholders have a 14% indirect stake in Distell via their shareholdings in SABMiller, Remgro and KWV Investments. — I-Net Bridge