PPC said the deal – the second in four years to meet South Africa's affirmative action rules – would take shareholding by black investors in its domestic operations to 26% and enable it meet the rules set out by the government.
Companies in South Africa have to meet quotas on black ownership, employment and procurement as part of a government drive to shift more of the mostly white-controlled economy into the hands of the black majority.
Johannesburg-based PPC said on Thursday it would cancel about 20-million treasury shares it bought back to help counter the dilutive effect of the new 39.3-million shares to be issued for the transaction.
The company's 2 400 South African employees will be issued 68% of the new shares and existing and new women groups would take up the rest.
The transaction value of about R1.1-billion is based on the 30-day volume-weighted average price of PPC shares of R27.39 per share as of Monday, July 9. – Reuters