The majority shareholder in Ascendis Health had concluded a black economic empowerment (BEE) agreement with a subsidiary of the Mineworkers Investment Company (MIC) which would see the BEE shareholding increase over a three-year period, the company said on Thursday.
A fixed-coupon convertible, redeemable debenture valued at R200 million would be issued by Coast2Coast, the majority shareholder in Ascendis that is owned by non-executive directors Gary Shayne and Crispian Dillon. The BEE shareholding in Ascendis Health will grow from R165 million to R365m.
“Given the early stages of Ascendis as a listed company, coupled with its focused growth strategy, any issue of additional Ascendis shares would be unwontedly dilutive to existing shareholders, meaning that the cost of the transaction will be borne entirely by Coast2Coast, resulting in no earnings dilution or impact for Ascendis shareholders,” the group said.
It said the coupon would be convertible in three tranches into Ascendis shares at a discount top the ruling price.
The company, which listed on the JSE in November last year, has interests in human, animal and plant health-care brands. Consumer brands make up the biggest portion of its portfolio at 45 percent.
“We are excited about the conclusion of the meaningful empowerment deal, assisting towards our transformation goals,” Ascendis chief executive Karsten Wellner said.
He added that MIC Investment Holdings had invested in Ascendis during its listing and was keen to increase its exposure to the health sector through the group by becoming the key BEE partner.
MIC is a 100 percent black-owned investment company established in 1995 by the Mineworkers Investment Trust. The group aims to create a sustainable asset base for the benefit of workers in the mining, energy and construction sectors and their dependants. It has a net asset value of over R4.15 billion and has over the past 19 years disbursed more than R390m to the trust.
“The MIC has been looking at the health sector for a number of years, with a view to invest in a growing sector that is of national strategic importance. We believe Ascendis and its management team [are] a good fit with MIC’s own criteria for investing. We look forward to a long and mutually beneficial relationship with Ascendis,” said the MIC’s chief executive, Mary Bomela.
Ascendis shares leapt 8.7 percent to R12.50 on Friday.