BEE Deal of the Year
DealMakers Annual Gala Awards
At the end of each year, DealMakers calls on the corporate finance industry to submit their nominations for the BEE Deal of the Year (this was first awarded at the 2019 Gala Dinner).
With the assistance of the independent panel, and taking into account the number of nominations each deal has received, a shortlist of 3 - 5 deals is announced.
These deals are then evaluated by the Independent Panel and they select a winner based on a variety of criteria, including but not limited to:
The transformational aspects of the deal | The execution complexity | The deal size | The potential value creation of the deal
2020 BEE Deal of the Year
Gold Medal Award
Novartis' disposal to Kiara Health
Dr Skhumbuzo Ngozwana, CEO and President | Kiara Health
Novartis, the Swiss multinational pharmaceutical company, took the strategic decision globally to move away from holding manufacturing in-house. Kiara Health, having secured the necessary funding, acquired the manufacturing plant and several marketed products from Novartis’ subsidiary generic drugs manufacturer Sandoz South Africa, creating a majority black-owned pharmaceutical manufacturer. The parties entered into a manufacturing and supply agreement for a minimum four year period.
Other nominees for 2020 were:
Momentum Metropolitan – establishment of the iSabelo Trust
The deal was announced to strengthen its B-BBEE ownership and benefit all permanent South African-based employees. The deal will constitute 3% of the company’s issued ordinary share capital resulting in c.44,9 million shares being acquired and held by the newly established Momentum Metropolitan iSabelo Trust. The scheme is intended to have a maximum duration of 15 years eligible for full settlement after 10 years with units allocated being subject to a maximum seven-year vesting period.
The local advisers to the deal were: Standard Bank, Webber Wentzel and EY.
Anheuser-Busch InBev’s B-BBEE transaction
In March 2020, Anheuser-Busch InBev (AB InBev), through its SAB subsidiary, concluded the partial unwind of SAB Zenzele, delivering R9,7 billion to its participants. An accelerated bookbuild offering 9,5 million AB InBev shares and priced at R7,6 billion was performed on behalf of participants electing to receive cash as part of the partial unwind. The deal initially offered participants the opportunity to reinvest a portion of their proceeds into SAB Zenzele Kabili, a new R5,4 billion BEE transaction. However, the onset of the COVID-19 pandemic resulted in this being postponed to 2021.
The local advisers to the transaction were: Rand Merchant Bank, Standard Bank, Morgan Stanley, Questco, Bowmans, ENSafrica, Webber Wentzel, BDO and PwC.
*** New Award***
2019 BEE Deal of the Year
Gold Medal Award
Nampak’s disposal of Nampak Glass
Nampak, Africa’s largest diversified packaging manufacturer, sold its glass business to Isanti Glass 1, an entity 60% owned by black investment company Kwande Capital and SABSA, the local subsidiary of beer maker AB InBev and holding company of South African Breweries, with the remaining 40%. The deal, settled in cash, was valued at R1,5 billion.
Other nominees for 2019 were:
Barloworld’s Khula Sizwe Property deal
The Barloworld Khula Sizwe BEE transaction was a two-component transaction involving the sale of properties from Barloworld to newly created entity Khula Sizwe valued at R2,9 billion as well as the free issue of Barloworld shares (3% valued at R750 million) to the Barloworld Empowerment Foundation.
The local advisers to the transaction were: Tamela, Basis Points Capital, Identity Advisory, Nedbank CIB, Dentons; Poswa, Webber Wentzel, BDO and Deloitte.
Phuthuma Nathi partial switch to MultiChoice Group
In February 2019, MultiChoice Group (MCG) was unbundled out of Naspers and listed on the JSE with a market capitalisation of R46,52 billion. In its pre-listing statement MCG, which owns 75% of MCSA, committed to a share exchange offer in terms of which shareholders of PN1 and PN2 would be afforded the opportunity to exchange a portion of their shares for shares in MCG.
The local advisers to the transaction were: Rand Merchant Bank, Tamela, Webber Wentzel and PwC.
Sale by South32 of South Africa Energy Coal to Seriti Resources-led consortium
In November 2019 Australian-listed miner South32 announced the sale of its 91.835% stake in South Africa Energy Coal to Thabong Coal, a wholly-owned subsidiary of Seriti Resources, and two trusts. Post the transaction Thabong Coal will hold an 81.835% equity stake and each of the Trusts a 5% unencumbered interest for the benefit of employees and communities.
The local advisers to the transaction were: Morgan Stanley, Macquarie Advisory and Capital Markets South Africa, Rand Merchant Bank, UBS, ENSafrica and Malan Scholes.