Entries by tusker-admin

How to get out of a BEE deal

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.  […]

How the NCA sinks vendor-financed deals

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 […]

How the Government shoots BEE in the foot

Tusker is a BEE private-equity fund and our articles inevitably illicit quite a lot of reaction – much of it’s against BEE, and especially the perceived link between BEE and corruption (the extent of which understandably draws angry responses from fed up South Africans, especially in the business community). To be clear, Tusker believes in […]

Is BEE a farce?

Is BEE really a farce, or is that just ego speaking? Dr. Iqbal Surve (chairman and shareholder of Sekunjalo which in turn owns Independent Media) has been appearing before the Mpati Commission of Inquiry which is looking to the affairs of the Public Investment Corporation or PIC. In his testimony before the Commission Dr. Surve […]

BEE fronting – what it is, the risks, and what to do about it:

There has been a lot of recent publicity around BEE fronting and the B-BBEE Commission devoted much of its recent annual conference on BEE ownership to this very important topic. Fronting and BEE ownership can easily overlap. At the 2019 B-BBEE Ownership conference the Minister of Trade and Industry (under whose ministry the B-BBEE Commission […]

Is B-BBEE going away?

We’re frequently asked if B-BBEE is going away. The reality is that it’s here to stay – but likely to be changed/modified along the way. This article is an NB read for those who’d like to believe they can put off BEE until some magical future date – we think (for all the reasons listed […]

How to calculate the return on investment from BEE

Is BEE about transformation? compliance? or could it be an investment that sets up a sustainable competitive for your business? The lens you use to frame the problem is paramount to choosing the appropriate outcome and deciding if it’s worth the effort. When it comes to transformation, most business owners we speak to understand the […]

Is ownership the cheapest form of BEE?

Companies with sales under R50M that achieve 51% BEE ownership automatically qualify as level 2 BEE and don’t need to spend on any other scorecard points, those with 100% BEE ownership are automatic level 1. Is it better to go with ownership or spend on the rest of the scorecard? Our analysis shows that ownership […]

Preference shares in BEE deals

Preference shares in BEE financing: some of the pros and cons. When the framers of the BEE Codes wrote paragraph 3.14 of Code 100 (the ownership section) they opened a door to creative schemes, especially when they wrote “An Equity Instrument carrying Preferential Rights that have the characteristics of debt, regardless of whether the debt […]