JSE-listed Brimstone Investment has secured a suitable replacement broad-based black economic empowerment (BBBEE) investor to acquire its interest in Milco SA to facilitate Brimstone’s exit from its participation in the Clover scheme.
The replacement BBBEE shareholder is BEEMilk, an entity representing a consortium of investors comprising Khulasande Capital Trust through its fund manager Khulasande Capital III, Global Capital Empowerment Fund and Ubisi.
Brimstone has been seeking to exit a deal led by an Israeli company to buy a stake in Clover after protests by human rights and Palestine solidarity organisation Boycott, Divestment and Sanctions South Africa (BDS SA).
Milco has made an offer to acquire Clover by the end of the year. Central Bottling Co (CBC), based in Tel Aviv, is leading the transaction and is the biggest shareholder in Milco.
“Having regard to our company’s values-driven identity, we have taken note of the widespread outrage in respect of Brimstone’s participation in the proposed purchase of . . . Clover . . . Brimstone has, therefore, decided to review its role in the proposed transaction,” the company said in February.
BDS SA had also released a statement in February expressing concern that the consortium of companies that intended to acquire Clover included CBC.
“If the deal proceeds, Israel’s CBC will take control of 59.5% of the South African milk and dairy company,” it said, proceeding to list human rights abuses in which CBC was allegedly complicit.
Brimstone indicated in a statement on Friday that the anticipated total one-off costs incurred and to be incurred to give effect to the board’s decisions to enter into and exit the Clover transaction would be R55-million relating to Brimstone’s contribution in disposing of its right to subscribe for Milco shares; R6.2-million in legal and regulatory fees; R7.3-million in advisory fees; and R200 000 in other costs.
Engineering News Online earlier this week reported that the Competition Commission had recommended to the Competition Tribunal that the proposed merger whereby Milco intends to acquire Clover, be approved, with conditions.