Oceana makes its case for full rights

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Johannesburg - When Oceana announced yesterday that it would be paying out R289 million to the beneficiaries of its empowerment trust, it wasted no time in pleading for its fishing rights to be assured.

Oceana said the R289m cash payout was only a quarter of the value that the company employees’ empowerment trust had generated.

“What we’ve achieved is far more than what we would have been able to achieve if these [fishing] rights were given to players with less resources and experience,” Oceana chief executive Francois Kuttel said during the announcement.

The Oceana Empowerment Trust holds an 11.7 percent equity stake in the company. As of last month, the market value of the shares it held equated to over R1.17 billion.

Between 2009 and this year, value created in the trust – which was created in 2006 – was approximately R700m. It acquired its stake in Oceana for R219m, funded though debt provided by Oceana and some external funding.

Part of the debt has been paid off through dividends and the remaining balance was now R140m. The cash payout announced yesterday already exceeded the initial debt.

Kuttel said while he was not implying that small-scale fishers should not be given fishing rights, the National Development Plan recognised that reducing the rights allocated to big fishing firms to award them to small-scale fishers would not support job creation.

“I believe that the erosion of our rights would not be in the interest of the country at large,” Kuttel told Agriculture, Forestry and Fisheries Minister Tina Joemat-Pettersson.

Oceana’s fishing rights will be up for assessment next year and again in 2020. When its squid rights were reviewed late last year, they were renewed.

Joemat-Pettersson said empowerment and creating value for the fishing communities out of the fishing rights given to companies was an important criteria that would be assessed during the rights allocation.

But she said her department had ring-fenced quotas for small-scale fishers, which would be allocated when the appeals process for the rights allocated in January was completed. The process would end later this month and the allocation of fishing quotas would happen next month. Joemat-Pettersson said this might happen after the elections.

Each one of Oceana’s 2 650 black employees and former employees who are members of the empowerment trust will get an average of R100 000 after tax. Oceana has just under 4 000 employees. Those who are not part of the trust are either Namibian residents or white.

The trust has 100 percent participation of its black employees. Trust beneficiaries will receive a further amount in 2021, which is the end of the trust’s lock-up period. Beneficiaries with participatory rights will then be able to convert their rights into shares.

Kuttel said taking into account what the beneficiaries had and what they would receive in 2021, at yesterday’s rand value, the average employee had an equity value of R450 000 net of debt.

The share price lost 1.23 percent to close at R90.87 yesterday. - Business Report


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