SAB Zenzele Transaction clinches DealMakers Deal of the Year Award
25 February 2010
Johannesburg, 25 FEBRUARY 2010
The South African Breweries Ltd (SAB) is delighted to have been awarded DealMakers magazine "Deal of the Year" award for its Zenzele black economic empowerment transaction. The publication announced their annual rankings and award winners for 2009 at its annual banquet in Sandton on Wednesday evening, 24 February.
The R7.3-billion Zenzele broad-based BEE deal was one of fourteen deals short-listed for this award category which were judged by an independent panel led by Professor Mthuli Ncube, Dean of the Commerce Faculty at the University of the Witwatersrand.
SAB Zenzele was first announced on 1 July 2009 and will ultimately place 8.45% of the company's shares under black ownership.
Transaction participants include SAB employees, qualifying black-owned liquor and soft drink retailers, and a new SAB Foundation. After the ten-year transaction period, SAB Zenzele shares will be exchanged for SABMiller shares. The transaction will equate to an effective 14.1% BBBEE transaction in terms of the BBBEE Codes of Good Practice.
SAB MD Norman Adami says: "We are honoured to have received this award which recognizes our goal of delivering a broad-based empowerment transaction which is both innovative and distinctive."
"The award clearly demonstrates one of our key values in action, namely that we work and win in teams. A multi-disciplinary team representing all functions across the business has worked on our Zenzele transaction and I am very proud of all the team players. We are now focused on ensuring it is successfully implemented," he says
This week, the retailer component of Zenzele opened for participation by retailers. The offer is scheduled to close on 7 April 2010 and will be implemented in May 2010.
Several factors make the Zenzele transaction distinctive, including that:
- The benefits of the deal are targeted at key stakeholder groups who play a meaningful role in the long term business success of SAB and its soft drinks division ABI;
- No external bank funding is required;
- A meaningful bi-annual cash dividend is expected to be paid from year one; and
- The transaction is affordable and easily accessible - qualifying retailers will make only a small cash investment.
The fact that Zenzele also acts as an incentive for beer and other liquor retailers to become licensed is a key societal benefit and in keeping with SAB's belief that the liquor industry as a whole can only become sustainable once it has been normalised.
Participants will, from inception, have voting and economic rights in SAB, and bi-annual cash dividends are expected to be paid to all participants from year one for the whole of the ten-year transaction period.