Johannesburg - SABMiller and Anheuser-Busch (AB) InBev passed another hurdle last Friday as after months of negotiations, the Food and Allied Workers Union (Fawu) accepted a R1.5 billion deal from the merging parties on the South African Breweries (SAB) Zenzele employee share programme.
Fawu general secretary Katishi Masemola said yesterday that a R1.5bn payment would be made not only to the 9 146 employee portion of the beneficiary base as originally envisioned, but was now extended to other Zenzele beneficiaries, totalling 41 000 registered and qualifying liquor store and tavern owners.
This was now an advanced payment - and not an ex-gratia, once-off payment - on an interest-free basis at about R32 per Zenzele scheme participation right - effectively an SAB or SABMiller’s South African operations’ share - and deductible at the end of the scheme.
For a worker who has 1 000 shares they will now receive R32 000.
Masemola said yesterday that the outcome was not the “expected first prize, but the best outcome in the circumstances”.
Advance payment
He said when consulting with Fawu workers, the members had opted not to strike and had wanted the advance payment.
Fawu has taken an active interest in the mooted multibillion-dollar merger between AB InBev and SABMiller, because some of its members at SAB, SABMiller’s wholly-owned subsidiary, are beneficiaries of Zenzele a broad-based black economic empowerment (BEE) transaction that was implemented in June 2010.
Fawu said it was guaranteed that value of the current Zenzele share, which was sitting at about R273 at the end of last month, would be guaranteed at a linked value of £45 (R784) even if the share price was less than this come 2020.
“For now, beneficiaries will continue to receive six-monthly dividends going into the future until 2020,” the union said.
Masemola said he expected that the Zenzele beneficiaries would receive the advance payment by September or October.
In a bid to ensure that the workers get a slice of the spoils from the mega deal, the union had made submissions when the merger went to the country’s competition authorities.
The union had previously demanded that Zenzele beneficiaries should be treated like other SABMiller shareholders. Under the initial terms of AB InBev’s offer to buy SABMiller, the Zenzele scheme was to continue operating until maturity in 2020.
Fawu had previously said it either wanted the merging companies to accelerate the end of Zenzele so that beneficiaries could be paid out or it as an alternative it had wanted the companies to pay an ex-gratia, once-off payment of an average of R165 000 per beneficiary, totalling about R1.5bn, to be paid out in lieu of opportunity cost for staying “locked” in the scheme until 2020.
The pound has been volatile following the surprise exit vote of the Britain from the EU, complicating the deal.
Fawu said it would be engaged, as from next year on the new BEE transaction, that would kick in in 2020, given that the employee share ownership plan (Esop) trust was expected to be a majority in such BEE transaction and that such an Esop would see equal allocation of shares/units between executives and lowest-paid workers.
The meetings came as AB InBev was steaming ahead with preparatory work for the merger. The brewing giant, which is listed on the JSE, recently unveiled the organisational structure and leadership team of the merged entity.
The merger was expected to be completed on October 10, according to a timetable announced by AB InBev this month. SABMiller shares gained 1.43 percent on Friday to R760.79.
For now beneficiaries will continue to receive six-monthly dividends until 2020.
BUSINESS REPORT