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JSE-listed Mpact will pursue a broad-based black-economic empowerment (BBBEE) deal that will see a partner acquire 10% of the ordinary shares in subsidiary company Mpact Operations.
This followed the exit of its previous BBBEE partner Shanduka Packaging in 2012.
Through Mpact Operations, the group would pursue “true empowerment” of previously disadvantaged stakeholders with a focus on broad-based groupings. The group expected to conclude the transaction by the end of June.
"Since the exit by the group’s previous partner, the board has been considering various options to reintroduce BBBEE ownership into the group,” Mpact CEO Bruce Strong said in a statement on Wednesday.
He added that the resolution by the board confirmed Mpact’s commitment to BBBEE in South Africa, particularly in communities where Mpact operates.
“We view the proposed BBBEE transaction as a flagship empowerment initiative and look forward to not only continue with our existing BBBEE projects, but also pursue new empowerment initiatives that have been identified to make a real difference to people in need," Strong noted.
Speaking to Engineering News Online in a telephone interview, he said the context of the BBBEE deal was about “the spirit of transformation”.
“We have had time to evaluate what the best way forward is and we still worked hard on the other elements of the scorecard to ensure that we are transforming,” he added.
Mpact would act as founder of the Mpact Foundation Trust and would be responsible for the appointment of the relevant trustees, of which at least 50% shall be independent from the Mpact Foundation Trust, at least 50% shall be black people and at least 25% shall be black women.
The beneficiaries of the Mpact Foundation Trust would include Mpact Operations employees and their families; emerging entrepreneurs; suppliers and customers directly or indirectly involved in the packaging or recycling sectors; and primary, secondary and tertiary education initiatives.
At least 85% of distributions to further the Mpact Foundation Trust’s objectives would be used to benefit black people, of which at least 40% would be black women.
“Through a trust of this nature, with the right approach, we think that it can be a seed for the industrialists that we are so desperately looking for in South Africa, whether it’s through education or the seeding of entrepreneurial businesses – all of these things add up to real transformation.
“We are proud to be part of a successful BBBEE scheme,” he told Engineering News Online.