Black investors who want an indirect stake in MultiChoice's Phuthuma Nathi and Media24's Welkom Yizani black economic empowerment initiative still have three more days to fill in their application forms.
Black investors who want an indirect stake in MultiChoice's Phuthuma Nathi and Media24's Welkom Yizani black economic empowerment initiative still have three more days to fill in their application forms.
Both companies announced last week that the application date had been extended until this Friday.
The heavily discounted schemes, which black groups and individuals can buy at R10 a share though the share is valued at R50, should have closed last Friday, but MultiChoice South Africa and Media24 have extended the closing date to allow black investors and black groups more time to take advantage of the offer.
According to Nolo Letele of MultiChoice South Africa and Hein Brand of Media24, there have been numerous requests from black people for them to extend the date.
Mandla Langa, chairman of Phuthuma Nathi, said some black groups interested in participating in the scheme had asked the organisation to extend the deadline because they needed more time to submit their initial BEE ownership certificate of compliance.
The two media giants have adjusted the compliance certificate requirements to help them submit their applications on time.
Both companies said there had been "very positive and overwhelming" responses from prospective black shareholders.
Media24's Brand said on Friday that "spectacular" public support had been received for the Welkom Yizani black economic empowerment share offer.
"Applications from an overwhelming 47300 people and 600 groups were received by yesterday [last Thursday], resulting in an oversubscription."
The company, however, was expected to process applications received by 3pm on Friday. Welkom Yizani's interim board of directors will then determine the allocation of shares within 30 to 44 business days, as specified in the prospectus.
The Media24's Welkom Yizani offer has much of the same characteristics as those of Phuthuma Nathi, and experts have advised investors to understand the advantages and disadvantages of the two investment initiatives.
Though black investors will receive a discount of 80percent funding from Media24 Holdings, participants will not receive any dividend for the duration of the five-year period unless the two shares perform at their best.
The shareholder is also locked into each empowerment contract for five years, a disadvantage experts say for black groups whose individual members might want to withdraw from the initiative before the five-year period is over.
Another major disadvantage is that the empowerment shareholders can only sell their shares to individuals who, as both companies say, have "at least a similar or higher BEE status or rating".
This means a shareholder can only sell shares to another black shareholder or black group with a BEE status.
Suppose the shareholder dies before the end of the investment period, the share may be transferred to his or her heir, provided the heir has at the very least a similar status.
Should the heir not have a similar or higher BEE status, the heir must transfer the relevant shares within six months of having taken possession of them to an eligible shareholder who is also black.
The companies' aim is to ensure a strong BEE status remains after the five-year term.
Closing date for black investment schemes extended after overwhelming response, writes Isaac Moledi
Black investors who want an indirect stake in MultiChoice's Phuthuma Nathi and Media24's Welkom Yizani black economic empowerment initiative still have three more days to fill in their application forms.
Black investors who want an indirect stake in MultiChoice's Phuthuma Nathi and Media24's Welkom Yizani black economic empowerment initiative still have three more days to fill in their application forms.
Both companies announced last week that the application date had been extended until this Friday.
The heavily discounted schemes, which black groups and individuals can buy at R10 a share though the share is valued at R50, should have closed last Friday, but MultiChoice South Africa and Media24 have extended the closing date to allow black investors and black groups more time to take advantage of the offer.
According to Nolo Letele of MultiChoice South Africa and Hein Brand of Media24, there have been numerous requests from black people for them to extend the date.
Mandla Langa, chairman of Phuthuma Nathi, said some black groups interested in participating in the scheme had asked the organisation to extend the deadline because they needed more time to submit their initial BEE ownership certificate of compliance.
The two media giants have adjusted the compliance certificate requirements to help them submit their applications on time.
Both companies said there had been "very positive and overwhelming" responses from prospective black shareholders.
Media24's Brand said on Friday that "spectacular" public support had been received for the Welkom Yizani black economic empowerment share offer.
"Applications from an overwhelming 47300 people and 600 groups were received by yesterday [last Thursday], resulting in an oversubscription."
The company, however, was expected to process applications received by 3pm on Friday. Welkom Yizani's interim board of directors will then determine the allocation of shares within 30 to 44 business days, as specified in the prospectus.
The Media24's Welkom Yizani offer has much of the same characteristics as those of Phuthuma Nathi, and experts have advised investors to understand the advantages and disadvantages of the two investment initiatives.
Though black investors will receive a discount of 80percent funding from Media24 Holdings, participants will not receive any dividend for the duration of the five-year period unless the two shares perform at their best.
The shareholder is also locked into each empowerment contract for five years, a disadvantage experts say for black groups whose individual members might want to withdraw from the initiative before the five-year period is over.
Another major disadvantage is that the empowerment shareholders can only sell their shares to individuals who, as both companies say, have "at least a similar or higher BEE status or rating".
This means a shareholder can only sell shares to another black shareholder or black group with a BEE status.
Suppose the shareholder dies before the end of the investment period, the share may be transferred to his or her heir, provided the heir has at the very least a similar status.
Should the heir not have a similar or higher BEE status, the heir must transfer the relevant shares within six months of having taken possession of them to an eligible shareholder who is also black.
The companies' aim is to ensure a strong BEE status remains after the five-year term.
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