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Ascendis Health, the third-largest pharmaceuticals company on the JSE, has concluded an agreement with the 100% black-owned Mineworkers Investment Company (MIC), which will see the fund’s black economic-empowerment (BEE) ownership in Ascendis increase over a three-year period.
This would increase the total BEE ownership in Ascendis from R165-million to a potential R365-million.
The agreement was structured through Ascendis’ majority shareholder Coast2Coast (C2C), which issued the MIC with a fixed, coupon-convertible, redeemable debenture to the value of R200-million, with the coupon convertible into Ascendis shares in three tranches.
“Given the early stage of Ascendis as a listed company, coupled with its focused growth strategy, any issue of additional Ascendis shares would be unwontedly dilutive to existing shareholders, meaning that the cost of the transaction will be borne entirely by C2C, resulting in no earnings dilution or impact for Ascendis shareholders,” commented Ascendis CEO Dr Karsten Wellner.
He added that the MIC had invested in Ascendis during its listing in November and was keen to increase its exposure to the health sector by becoming the pharmaceuticals group’s key BEE partner.
The MIC, which was established in 1995 by the Mineworkers Investment Trust (MIT), has a net asset value of over R4.15-billion and has, over the past 19 years, disbursed over R390-million to the MIT.
MIC CEO Mary Bomela said the company had been looking at the healthcare sector for a number of years, with a view to investing in a growing sector of strategic national importance.
“We believe Ascendis and its management team are a good fit with MIC’s own criteria for investing, and look forward to a long and mutually beneficial relationship with Ascendis and C2C,” she remarked.