In a BEE deal, Sahara Holdings has divested 27% of its shares to a newly established consortium, the mining and mineral resource group Mvelaphanda Holdings, the local investment consortium, Afripalm Consortium, and the Sahara Employees Trust Fund.
The shares are being sold for R173 million. The agreement offers both Mvelaphanda Holdings, headed by executive chairperson Tokyo Sexwale, and the Afripalm Consortium, headed by Lazarus Zim, a 12.1% stake in the company.
A further 2.8% of the shares will be subscribed to the Sahara Employees Trust Fund administered by four trustees, one of whom is nominated by the Sahara board of directors and the rest are employees.
The present valuation of the company is R960 million. Following Sahara?s discount to its BEE partners of 33%, the company?s valuation stood at R640 million.
The deal incorporates subsidiaries of Sahara Holdings including Sahara Computers, Sahara Systems, Sahara Consumables, Sahara Distribution and Annex Distribution.
The Sahara board of directors will make way for new appointments, representing each partner in the deal. Parties have also agreed to the appointment of two additional independent directors, representing two Sahara subsidiaries, to the board.
Atul Gupta, Managing Director at Sahara Holdings, believes the partnership is based on the principles of true broad-based economic empowerment.
"Our objective from the outset was to ensure a broad-based partnership that would result in the transfer of benefit to all stakeholders. Aside from the fact that we welcome new appointments to our board of directors, we have also established the Sahara Employee Trust Fund through which we will continue to support, develop and invest", Gupta explains.
In seeking out a concrete partnership, management at Sahara was adamant about the criteria to which candidates had to adhere. This included a proven track record and a similar vision with regard to the key objectives of broad-based BEE.
"Mvelaphanda Holdings (Pty) Ltd and Afripalm Consortium are both fast moving and established leaders in their respective markets and are also broad-based. The intention of the government of South Africa, in terms of empowerment, is to provide the fruits of the development of the economy to the masses, hence the need for empowerment deals to be broad-based,' adds Gupta.
"This development in our company takes our current level of BEE accreditation a step further, in line with the ICT Charter, a recognized industry compliance guide, as well as government empowerment policy. It is also an investment in the leading role South Africa?s ICT sector plays on the continent,' he continues.
Vusi Mavimbela, Group Executive Director Business Strategy of Mvelaphanda Holdings, comments that "Mvelaphanda Holdings has selected Sahara and the Afripalm Consortium as strategic broad-based black economic empowerment partners based on the credentials of these established organizations."
"We are confident that these partnerships will help to form a solid basis from which we can all reach our objectives for common broad-based black economic empowerment and its dynamics in South Africa," he said.
"Afripalm Consortium is excited to be part of this new initiative' comments Lazarus Zim, Chairman of Afripalm Holdings. "We believe in the value each party brings to initiative, especially Sahara?s skills knowledge and experience in ICT sector as the initiator of this great partnership.'