Figures have, once and for all, settled the debate on whether the black beneficiaries of much hyped black economic empowerment on the JSE have really benefited from billion rand transactions that have taken place.
An Intellidex report revealed that, cumulatively, BEE deals done by the JSE’s 100 largest companies generated R317bn of value for beneficiaries since the inception of black economic empowerment (BEE).
Intellidex, which is a capital markets and financial services research house, took six months to complete the project which involved comprehensive analysis of every company’s deals.
According to the intellidex, the value represents the net asset value after all debt and other financial obligations are deducted.
Further, refreshingly, 34% of the total, which translates to R108bn, has been generated mainly by BEE deals that have matured and are free trading restrictions or financial obligations. According to Intellidex, the breakdown of beneficiaries is as follows: staff schemes, strategic investment partners and broad-based community schemes. Strategic partners are companies and prominent individuals, but often have broad bases of beneficiaries. Community schemes, by contrast, are usually non-profit trusts that provide a long-term annuity stream for beneficiaries.
In an analysis of the findings, Intellidex chairperson Stuart Theobald said it the amount generated proved that recent statements that BEE deals do not create substantial value were false.
