Cementing a real BEE deal

Natal Portland Cement (NPC) announced what it described as a broadly-based black economic empowerment (BEE) transaction at the weekend.

Natal Portland Cement (NPC) announced what it described as a broadly-based black economic empowerment (BEE) transaction at the weekend.

The company is a subsidiary of Cimentos de Portugal SGPS SA (Cimpor). Cimpor will sell a 26percent stake in NPC's cement operations to black-owned businesses, based on an enterprise value of R3,5billion. This will be done through newly formed NPCCIMPOR, which will house all the South African cement assets of the NPC.

The transaction will be largely vendor financed by the NPC and is intended to facilitate broadly-based empowerment with its partners, who are based primarily in KwaZulu-Natal and comprise the NPC staff trust and Siyakha Cement Holdings.

Siyakha will comprise the NPC education and entrepreneurial development trust, and business partners Nkunzi Investment Holdings and the Imbewu-Aka consortium.

The NPC's managing director, Pieter Strauss, said: "This is an important step in Cimpor and NPC's commitment to genuine broad-based empowerment.

"We focused on a transaction that makes business sense and, through a considered and transparent process, we have found the right partners to play an important role in the continued growth and development of the business, particularly at a time when the cement industry in South Africa is undergoing significant expansion."

The transaction will give the new partners an unencumbered equity interest in the cement operations from its implementation.

The business consortium will hold an effective 15,17percent and is invested in Nkunzi Investment Holdings, a BEE company, and Imbewu-Akaconsortium, made up of the Imbewu Capital, Aka Capital and the Imbewu-Aka women's group partners.

Johannes "JB" Magwaza, Nkunzi's executive chairman, said: "Nkunzi not only shares a long-term commitment to the continuing growth of the business but also has a responsibility to socio-economic upliftment in South Africa and the region." - I-Net Bridge

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