Johannesburg – Cement producer PPC says, after
it implemented its new empowerment scheme, it has seen a net R1 billion inflow.
This cash,
which came as its partners and community groups brought 15.6 million shares,
will be used to further debt and fund capital expenditure, especially the Slurry
kiln 9 project.
The company
also bought back and cancelled 48.6 million shares at 10c each, it says.
This means
its net stated capital is now at 1.6 billion shares as its net capital dropped
by 33 million shares.
However, it
says, the deal reduced its empowerment credentials, and it is working on a new
deal, which will be communicated by June.
Read also: PPC eyes higher rating with BEE amendments
When PPC
announced the completed deal last year, Sibonginkosi Nyanga, an analyst at
Momentum SP Reid Securities, said if it did not embark on a new BEE scheme and,
once its certificate expired in December, its empowerment rating would probably
drop to level 7 under the revised Trade and Industry Department BBBEE codes of
good practice.
Nyanga said
PPC’s current BBBEE transaction had also run into sustainability problems
because it had relied heavily on a positive trajectory in PPC’s share price,
but due to weak market conditions PPC’s share price had been under sustained
pressure.
At the
time, Business Report said PPC’s existing BBBEE transaction dates back to
December 2008. It involved four strategic black partners (SBP) - women’s
empowerment group Nozala, black-owned and managed Peu, empowerment investment
firm iLima Portland Consortium and broad-based group Capital Edge Cement
Consortium - and two community services groups (CSG).
BUSINESS REPORT ONLINE