All three business units at leading South African heavy engineering and solutions group Efficient Engineering have been verified as level 1 broad-based black economic empowerment (BBBEE) companies under the South African government’s new codes.

Verification agency BEE on Call confirmed the top-level rating – which covers heavy engineering and fabrication company Efficient Engineering, as well as liquid-bulk tanks constructor Efficient Trotech and energy solutions company Efficient Power – in November.

CFO Lenny Govender tells Engineering News Online that the ownership dimension has been secured through the Shalamuka Trust, which owns 49% of the business. Shalamuka, whose beneficiaries are mostly black women, is associated with RMB Corvest, which itself owns 26% of Efficient Engineering.

The balance of the company is held by executive management (20%) and Algep (5%), representing the founding Cimato family – Efficient Engineering was established by Giuseppe Cimato in 1968.

The journey to progressively improve the group’s BBBEE rating began 18 months ago under the stewardship of board, who embraced transformation as a way of improving the company’s competitive positioning in its traditional mining market, as well as in the new sectors it has begun targeting.

The restructuring has been associated with a rapid diversification of the company’s customer base, with mining equipment currently comprising about a third of the group’s order book, having previously made up over 90% of sales.

The 600-employee company, which has 29 000 m² of workshop area in Ekurhuleni and Durban, is now increasingly active in the electricity and oil and gas markets, having recently fabricated the initial five 74-m-long “bullets” for a liquid petroleum gas terminal being developed at Saldanha Bay, in the Western Cape.

The company has even penetrated the science-and-technology market, through the supply of stationary pedestal and rotating yokes for the antennas being used as part of the MeerKAT radio telescope project, in the Northern Cape.

Govender says market and geographic diversification remain a focus and that the company may even consider opportunistic acquisitions to support its ambitions in this regard.

However, executive director for business development Vees Moodley stressed that ownership is also but one, albeit important, component of the group’s empowerment journey. The remainder of the points have been secured through the group’s skills development, preferential procurement, employment equity and corporate social responsibility activities. The company is currently training beyond its own internal requirements, with a big focus on the development of women and youth welders.

Moodley says the company remains committed to retaining its leading empowerment status in the domestic manufacturing environment. He nevertheless bemoans the lack of recognition of its efforts in certain subsectors of the economy.

“It is disheartening that we continue to lose contracts to Chinese and Indian competitors. And while we have limited leverage over our private-sector clients, we do believe that the State-owned companies should take more of a lead in supporting those local companies that have made the effort to invest in transformation.”