President Thabo Mbeki on Friday lauded the Holcim-AfriSam deal and lambasted those questioning the Swiss cement company’s motive in selling most of its South African subsidiary to a black consortium.
On the face of it, this transaction should have been warmly welcomed by those who support the objective of creating a non-racial South Africa, which would include both political and economic transformation, he said in his weekly newsletter on the
ANC website.
”But interestingly, the Holcim August announcement has attracted comments that verge on the hostile,” he said.
In effect, Holcim had decided it made good commercial sense for Holcim South Africa to be black-owned and controlled. Since it had come to the conclusion that black economic empowerment (BEE) was not a threat to commercial success, but made good business sense, it saw no reason why it should accept black South Africans only as minority shareholders, or engage in a protracted, step by step progression to black ownership of its Southern African subsidiary, if this was its fundamental intention.
”It therefore took the decision that it was strategically correct that a major global company, such as Holcim, has the capacity both to demonstrate its unqualified commitment to building a non-racial South Africa, and to create the best conditions for the growth of its erstwhile subsidiary, by turning it into an African company, rather than retain it as a subsidiary of a Swiss company,” Mbeki said.
The company also decided that its longer-term interests in South Africa and the region, would best be served by having a strong partner, with which it could enter into joint ventures, constituting a true African-Swiss equitable corporate partnership.
Mbeki said it was clear that some people considered the projected Holcim-AfriSam agreement to be ”too good to be true! There has to be a catch somewhere! There has to be some underlying negative intention on the part of Holcim, cunningly disguised as black economic empowerment!”.
It was clear that in their view, what would have been good and acceptable would have been for Holcim to do the minimum required, and sell only 26% of its equity to its BEE partners.
”To facilitate black ownership and control despite the current and future excellent market conditions, with virtually guaranteed good profits, has made absolutely no sense to those intensely focused on ‘the bottom line’ of the annual financial statements.”
Negotiations to close the deal had not as yet been finalised, and it was virtually guaranteed this transaction would continue to be attended by controversy, in good measure driven by a sense of disbelief among the sceptics.
The fundamental matter to them was the unfathomable puzzle that an eminently successful global company, such as Holcim, could actually come to the conclusion that ”the prerogative of economic transformation [in South Africa], can be put at the heart of a company’s overall corporate development strategy so as to maximise the potential for growth and stability, which is where we believe it was intended to belong”.
What was a puzzle to these hard-nosed sceptics would be celebrated by others who were committed to non-racialism and human fulfilment as a major and unprecedented step forward.
The latter would be excited that a major international corporation got truly inspired by its social responsibilities, leading it to reach out to the nation beyond the commercial imperative to make immediate financial profit, Mbeki said. – Sapa