SOUTH AFRICA – The South African Breweries (SAB), subsidiary of AB InBev is set to launch its new B-BBEE scheme SAB Zenzele Kabili which will own R5.4 billion (US$371m) worth of the parent compay’s shares, after the maturation of its SAB Zenzele in May 2021.
SAB Zenzele is the largest B-BBEE scheme in the history of South Africa in the fast-moving consumer goods sector, with a total maturation value of R9.7 billion.
Launched in 2010, the landmark scheme transaction endeavoured to give the company’s retailer partners – taverners, bottle store owners, retailer customers and employees, an opportunity at real ownership in a company that has brought South Africans together for over 125 years.
Retailer shareholders who invested R100 (US$6.87) in 2010 will have received a total pre-tax pay- out of R77,518 (US$5,326) when the transaction fully unwinds in May 2021.
It was scheduled to unwind in March 2020, with SAB Zenzele Kabili envisioned to launch shortly thereafter.
However, Covid-19 driven restrictions prevented the necessary shareholder scheme meeting from taking place, at which time beneficiaries would have voted regarding pay-outs and reinvestment options.
“The SAB Zenzele board, together with SAB, recognised at the time that such postponement would have a significant negative impact on the anticipated cash flows of shareholders, which had been exacerbated by the pandemic,” the group said.
The board subsequently resolved, together with SAB, that each SAB Zenzele retailer shareholder would be paid a cash amount equal to 77.4% of the calculation of its right and entitlement from the unwind of SAB Zenzele less applicable costs and taxes.
This cash payment, that amounted to R3.499 billion (US$240m) took place in April 2020.
The group added that the remaining entitlement of SAB Zenzele retailer shareholders was 22.6% of the calculation of their right and entitlement from the unwind of SAB Zenzele as at the date of the unwind of SAB Zenzele, adjusted for inflation over time.
In a bid to continue creating value for beneficiaries, SAB is offering the retailer shareholders the opportunity to reinvest a portion of their remaining proceeds into a replacement B-BBEE ownership transaction through the SAB Zenzele Kabili scheme.
“SAB Zenzele Kabili is set to be our biggest success yet, and despite these tough times, it’s time for a new scheme for new dreams and ownership for all.”SAB Zenzele Chairman – Dr Penuell Maduna
SAB Zenzele Kabili will be listed on the B-BBEE Segment of the Johannesburg Stock Exchange (JSE) to facilitate liquidity and broaden ownership to other B-BBEE investors, including qualifying SAB employees through a new employee stock ownership plan.
The scheme’s chairperson Dr Penuell Maduna said a meeting is scheduled to take place on May 10 in a digital environment where beneficiaries would vote regarding reinvestment of this portion.
“We all want to build a prosperous future for ourselves and our families. At SAB, we understand that this takes hard work and good partnerships,” said Maduna.
“SAB Zenzele Kabili is set to be our biggest success yet, and despite these tough times, it’s time for a new scheme for new dreams and ownership for all,” he added.
Those that reinvest into SAB Zenzele Kabili will henceforth become global shareholders, receiving 25% in dividends annually, without having to wait ten years before being able to sell shares or get paid out.
Additionally, SAB Zenzele Kabili shareholders will be able to trade immediately after listing.
The announcement comes months after Coca-Cola Beverages South Africa (CCBSA) indicated that it will transfer an additional 10% of shares to its employees, in a move aimed to enhance its black economic empowerment (BEE) status and meet its revised merger conditions.
To this end, the 8,000 employees of the soft beverage giant who already held 5% of the private company will now own 15%. Adding to the company’s external BEE partners, the combined black-owned equity stake will be 20%.
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