Johannesburg - Brewer Anheuser-Busch InBev (AB InBev) yesterday moved to defend its proposal of a cash payment to participants in the SAB’s Zenzele black economic empowerment scheme.
This follows union Food and Allied Workers Union’s (Fawu’s) steadfast opposition to the company’s proposals. The union will present its concerns to the Competition Tribunal hearings later this month, according to secretary-general Katishi Masemola. The Competition Tribunal yesterday said that hearings on the merger would commence on June 22.
Read: Beer merger: AB InBev aims to enhance union deal
AB InBev has proposed a guaranteed minimum value for SAB Zenzele shares, based on the £44 (R955) a share cash offer being paid to SABMiller shareholders, when the scheme matures in 2020.
“In addition, AB InBev is proposing an upfront advance cash payment for Zenzele participants to be paid shortly after closing the combination.
The cash payment would be roughly equivalent to the total gross dividends paid to participants from 2010 up to November 2015.
“Under the AB InBev proposal, participants would, therefore, enjoy the same premium being paid to SABMiller shareholders, would see an immediate cash benefit from the combination, and would benefit from future growth in the business, with no downside risk due to the guaranteed minimum value,” AB InBev said.
Within two years of closing the proposed combination, AB InBev would present an outline of its black economic empowerment plans to stakeholders in preparation for the maturity of the Zenzele scheme, the company said.
Chief executive Carlos Brito said: “We are committed to making a positive contribution to South Africa and have made wide-ranging commitments on employment, investing in the supply chain and promoting broad-based black economic empowerment.”
Meanwhile, the SMME Forum, a public benefit organisation, said it would make presentations at the tribunal hearings with its own demands on the merger. These include selling wine, beer and spirits producer Distell to a new entrant. SABMiller has a 26 percent stake in Distell.
The sale of Distell within three years after the closing date of the transaction was one of the Competition Commission’s conditions when it approved the deal last month.
SMME Forum president Tebogo Khaas said the organisation would also voice its concerns about the governance of the R1 billion fund to support emerging farmers, protect jobs and uphold broad-based empowerment.
The governance of the fund could not be left to the government and SABMiller, he said, arguing for an inclusion of “an industry body”.
The R1bn fund is one of several commitments AB InBev made in order to facilitate the transaction.
BUSINESS REPORT