Top three BEE deals for 2017 total R47bn
DealMakers recorded 24 black economic empowerment (BEE) deals in 2017,
The top three BEE deals were Sasol’s sale of a 25% stake in Sasol SA valued at R21bn; the intended sale of a 75% stake in Chevron SA valued at R13.3bn; and the sale of a 30% interest in Exxaro valued at R12.5bn.
Of the BEE deals recorded, 33% were in the mining sector, 21% in the IT sector and 17% in the property sector.
The need for meaningful transformation in equity ownership continues to be a subject of national discourse in the quest for inclusive economic development. This equity ownership should include the majority of the black population in this sector of the economy.
Although BEE has attracted criticism from some quarters as a policy which has failed to deliver the desired outcome — that of transferring wealth to the previously disadvantaged — more recent models include the necessary protection mechanisms such as lowering the funding cost or providing for a minimum payout at maturity as opposed to a simple extension of the transaction. Sustainability and the desired outcomes of a transaction should be factors influencing its design and structure.
The introduction of the new exchanges such as A2X and ZARX offer price savings on the transaction of shares, enabled by the use of the latest technology which is cheaper, faster and more agile than legacy systems at existing exchanges. This could change the static state of BEE investment.