BEE deals drive over R319 billion in value
By RDM NewsJune 25, 2015
“Recent statements that BEE deals do not create substantial value are false.”
That’s the conclusion Intellidex chairman Stuart Theobald has drawn from research released on Thursday which‚ it is claimed‚ for the first time puts a number to the value of black economic empowerment transactions.
“Deals done by the JSE’s 100 largest companies have collectively generated R317-billion of value for beneficiaries‚” an Intellidex statement said.
“What was particularly interesting is to see the value that staff and communities have derived‚” said Theobald.
“The numbers indicate that many poor and working class black South Africans now have access to significant resources because of BEE deals.
“To get a sense of the scale of the value‚ consider that it is 1.8 times the total corporate income tax take in 2014 and is enough to purchase the entire stock of planted agricultural land and machinery in the country.”
The R317-billion claimed by Intellidex “represents the net asset value after all debt and other financial obligations are deducted”.
Just over a third of this – or R108-billion – has been generated by BEE deals “that have matured and are no longer encumbered by trading restrictions or financial obligations (meaning that beneficiaries are free to use the value as they see fit)”‚ while the remaining R209-billion comprises “schemes that are still ‘live’‚ but are expected to mature within the next few years”.
The research found that R52bn (16%) of the total is attributable to staff schemes‚ R196bn (62%) to strategic investment partners and R69bn (22%) to broad-based community schemes. Strategic partners are companies and prominent individuals‚ but often have broad bases of beneficiaries.
Intellidex said that 2014 was a boom year “for maturing deals with almost R60-billion accruing to beneficiaries”‚ driven largely by huge deals made by FirstRand‚ Sanlam and Standard Bank.
The study also highlighted live deals from Exxaro and Naspers that are expected to yield R17-billion and R14-billion respectively when they mature.
“Recent statements that BEE deals do not create substantial value are false.”
That’s the conclusion Intellidex chairman Stuart Theobald has drawn from research released on Thursday which‚ it is claimed‚ for the first time puts a number to the value of black economic empowerment transactions.
“Deals done by the JSE’s 100 largest companies have collectively generated R317-billion of value for beneficiaries‚” an Intellidex statement said.
“What was particularly interesting is to see the value that staff and communities have derived‚” said Theobald.
“The numbers indicate that many poor and working class black South Africans now have access to significant resources because of BEE deals.
“To get a sense of the scale of the value‚ consider that it is 1.8 times the total corporate income tax take in 2014 and is enough to purchase the entire stock of planted agricultural land and machinery in the country.”
The R317-billion claimed by Intellidex “represents the net asset value after all debt and other financial obligations are deducted”.
Just over a third of this – or R108-billion – has been generated by BEE deals “that have matured and are no longer encumbered by trading restrictions or financial obligations (meaning that beneficiaries are free to use the value as they see fit)”‚ while the remaining R209-billion comprises “schemes that are still ‘live’‚ but are expected to mature within the next few years”.
The research found that R52bn (16%) of the total is attributable to staff schemes‚ R196bn (62%) to strategic investment partners and R69bn (22%) to broad-based community schemes. Strategic partners are companies and prominent individuals‚ but often have broad bases of beneficiaries.
Intellidex said that 2014 was a boom year “for maturing deals with almost R60-billion accruing to beneficiaries”‚ driven largely by huge deals made by FirstRand‚ Sanlam and Standard Bank.
The study also highlighted live deals from Exxaro and Naspers that are expected to yield R17-billion and R14-billion respectively when they mature.
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