SAB Zenzele scheme to pay out R9.7 billion to shareholders
An investment of R100 in 2010 – if you qualified – will pay out R76 000 at the end of next month
MORE than 40 000 SAB Zenzele empowerment shareholders will receive a whopping R9.7 billion in value when the scheme unwinds at the end of next month, the highest BEE value creation in the fast-moving consumer goods sector.
SAB parent and the world’s largest brewer, Anheuser-Busch (AB) InBev, said yesterday that members who invested R100 in 2010 would receive R76 000 shortly after the March 31, 2020, maturity.
The group said the investors could elect to sell the shares for cash or reinvest in a new empowerment scheme from the company.
It said the scheme would have delivered about R14bn in value for beneficiaries, including 29 000 retailer shareholders, 13 000 current and former employees and the SAB Foundation when it unwinds.
A new empowerment structure, to be listed on the BEE segment of the JSE, will be known as SAB Zenzele Kabili. Utilising a scheme of arrangement, which requires 75 percent approval from SAB Zenzele shareholders, SAB Retailers will invest a minimum of 15 percent of the value of their SAB Zenzele unwind value in exchange for shares in SAB Zenzele Kabili,
“I believe we have reached our goal to deliver real economic benefits to thousands of South Africans through SAB Zenzele. The opportunity to own AB InBev shares through SAB Zenzele Kabili means that they will benefit from the growth of our global business. (They) will also have enhanced liquidity and transparency of pricing for shareholders,” SAB Treasury M&A director Richard Rivett-Carnac said.
SAB Zenzele Retailer shareholders, the company’s participants in the employment share option plan as well as employees qualifying for a new employment share plan, will be eligible to invest in SAB Zenzele Kabili, while in return, the new empowerment vehicle will issue preference shares to SAB.
SAB launched SAB Zenzele in 2010 through, among other things, the issue of 3.52 percent of its total issued shares to people who, at the time, included qualifying retail liquor licence holders, applicants or registered customers of ABI (which was at the time to the soft drinks division of SAB).
The group said investors in the SAB Zenzele Retail would receive either R9.7bn in ordinary shares in AB InBev, or the cash proceeds from the sale of such shares.
However, SAB said feedback from SAB Zenzele Retailer shareholders was that they wished to be provided with an opportunity to re-invest some or all of their value in the new scheme.
The number of SAB Zenzele Kabili ordinary shares is capped at R344 million. So SAB Zenzele Retail shareholders who apply for shares in the new vehicle may not get all the shares they apply for.
The R5.4bn SAB Zenzele Kabili transaction will be funded through R678m equity from existing SAB Zenzele
Retail shareholders, R600m equity from a new broad-based employee share plan funded by SAB, R344m reinvestment by the SAB Foundation, R811m of AB InBev discounted shares from SAB and R2 97bn of 10-year preference share vendor funding from SAB.
The benefits of reinvesting in SAB Zenzele Kabili include that it will hold R5.4bn of shares in AB InBev’s global operations, substantial and attractive facilitation from SAB through discounted shares, and geared exposure through vendor funding at 70 percent of prime, for 10 years.
SAB vice-president of finance Andrew Murray said SAB intended to list the SAB Zenzele Kabili scheme on the JSE on April 15.
AB InBev shares declined 0.33 percent on the JSE yesterday to close at R1 092.98.