AMSA to move ahead with BEE equity transaction
Steel producer ArcelorMittal South Africa (AMSA) confirmed on Wednesday that it would be initiating a broad-based black economic-empowerment (BBBEE) ownership transaction and that KPMG had been retained to advise its board on the proposed transaction.
KPMG would engage with “a number of black investors with a view to successfully concluding a transaction”.
The announcement of its intention to pursue an equity transaction follows the unveiling last month of the Ikageng employee share ownership plan (Esop), relating to 4.7% of the issued share capital of the company. Sourced from treasury shares held by a subsidiary, the shares were currently valued at around R240-million.
However, CEO Paul O’Flaherty had indicated previously that the group also intended pursuing an equity transaction with black investors and that the JSE-listed group intended improving its BBBEE rating to level three under South Africa’s evolving empowerment regulations.
An earlier, highly controversial, R9-billion BEE deal with the politically connected Ayigobi Consortium was eventually abandoned.
“ArcelorMittal South Africa is committed to achieving full compliance with the country’s BBBEE Codes of Good Practice and to increasing broad-based participation in the South African steel industry,” O’Flaherty said, adding that progress had already been made on the other elements of the codes, including employment equity, skills development, enterprise development and procurement.
The full terms and salient dates and times of the proposed transaction will be announced in due course, the company said in a statement.
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