All businesses operating in South Africa are affected by the B-BBEE laws. While compliance with BEE is entirely voluntary, in practice the scorecard system means that it’s very hard to avoid. Typically, your customers put pressure on you to comply or they move their business elsewhere. Then the question becomes how to comply – and […]
Two of the most common complaints against BEE are that (a) it’s frequently used as a vector for the corrupt to plunder the economy and (b) that there is substantial policy uncertainty around it (and therefore the risk that the approach you take now might fall out of favour in future). The recent judgement handed […]
Statement 102: BEE ownership through the sale of assets: Businesses want the same things from BEE – ownership dilution at a fair price, with simplicity and trustworthy partners without giving up effective control of the business. Minority deals are relatively easy, but given the advantages of 51% BEE ownership, the control issue becomes very important […]
The business environment isn’t pretty: South African economic growth is flat or negative, the political climate is turbulent, the fat cats of state capture still live the high-life, and a ratings agency downgrade looms. It may seem all doom and gloom, but there is an upside. A real, significant upside that favours the stayers, the […]
To understand the ideal BEE deal we need to remove all the reasons why BEE deals currently suck. Why BEE deals <can> suck: Inexperienced transactors: For all of the reasons previously described, buying and selling shares in private capital markets is complicated and risky. Many of the lessons can only be learned through experience (as […]
Before we discuss the various ways of structuring BEE ownership deals, it’s worth looking at why deals suck. This article discusses the generic problems of transacting in private-capital markets (which covers 99.99% of the SA economy); the next article discusses BEE related issues in addition to these private-capital market problems. Transacting in private-capital markets is […]
Want to learn how to make BEE into a strategic advantage? You’re not alone: we’ve been asked many times if we’d share our experience in finance and BEE to help business owners and their advisors better understand how to make BEE into a strategic advantage. So we’re planning a series of 1-day workshops in the […]
Early last year the DTI put out several proposed changes to the BEE Act for public comment. We submitted our comments/concerns within the dates and subsequently met with the DTI to discuss them. Others did the same. Speculation as to which changes would come and which of the proposals would be discarded has ended: on […]
Relationships end with death or divorce. Legal fees and taxes are certain: Many relationships sour, once the excitement of the courting is over and the realization of the limitations of the partnership sets in. Sometimes this turns ugly (or the partner does?) and ends in litigation, often highly emotionally charged and sometimes just plain vengeant. […]
This may be one of the more NB articles we’ve written. No kidding. The most common method used to finance BEE might just become spectacularly unstuck thanks to the NCA (National Credit Act) and a whole bunch of money owed to ‘white’ sellers of shares may be unenforceable. Read on, and expect a flurry of […]
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