JSE-listed Balwin Properties has received shareholder approval for the implementation of a black economic empowerment (BEE) transaction.
CEO Steve Brookes says he has been working on a suitable empowerment transaction since the company’s listing on the JSE early in 2016, and is delighted about the support the company has received to implement it.
In terms of the transaction, a special purpose vehicle (SPV) owned by black shareholders will subscribe for 47.22-million newly issued Balwin shares. The total subscription price will be R4.55 less a 20% discount.
“In addition to the phenomenal work done by the Balwin Foundation, the operational side of Balwin has made considerable efforts in transforming our business over the past number of years in support of the principles and objectives of the BEE Act. This transaction will further improve our BEE scorecard rating,” notes Brookes.
The BEE SPV will be controlled by Reginald Kukama, who will hold 51% of the shares in the BEE SPV. A black female will hold 24% and black youth will hold the remaining 25%.
The BEE SPV owners will use R20-million of their own capital towards buying the newly issued shares, with the balance to be repaid from the proceeds of dividends and own contribution cash top-ups over the next ten years.
There is also a lock-in clause of ten years during which the shareholding may not be disposed of or encumbered.
Kukama founded Yaetsho Investments & Projects specialising in project management, property asset management and renewable energy. He has vast experience in the property sector with specific focus on project management.
Balwin believes Kukama will be a value-adding partner who has the functional and technical expertise to complement the existing board’s skillset.