What's empowerment got to do with it Willie? Of course I mean William Kirsh, the chief executive of Primedia, whose company has issued an objection to the Independent Communications Authority of SA (Icasa) granting New Africa Investments Limited (Nail) the approval to acquire Kagiso Media.
Kagiso controls 91 percent of East Coast Radio, and 42,5 percent of Jacaranda, while it has a 24,9 percent interest in OFM. Nail has a 22,4 percent shareholding in Kaya FM, and a 24 percent in P4 radio.
If the transaction is approved, Nail will control three FM licences, those of Jacaranda, KFM and East Coast Radio, contravening the current broadcasting regulation, which prohibits the ownership of more than two FM licences by one company. However Nail is using a section of the law which allows the regulator to grant exemptions if good cause is shown. So, Nail has made a submission to Icasa arguing on the grounds of its empowerment status.
Primedia, which was first to attempt a takeover of Kagiso Media, has described Nail's bid as anti-competitive. But most of all, it has challenged Nail's empowerment credentials.
What is interesting is that a few months ago, Primedia, which was interested in a deal with Kagiso, planned its own application for exemption to Icasa. Unfortunately Primedia's UK-based shareholders refused to let it go ahead with the deal.
As previously stated, one of Primedia's objections, is that Nail's empowerment status is dubious. In fact many schools of thought argue that Nail, with less than 2 percent of empowerment interest, does not qualify to even describe itself as an empowerment company.
Most probably to the delight of Primedia's leadership, these schools of thought would often quote the fact that the financial interest of Mineworkers' Investment Company (MIC) in Primedia was nearly 400 percent that of the comparable black interest in Nail.
The MIC may have a huge financial interest in Primedia as a comparable percentage versus that in Nail by blacks. But does this make Primedia a credible empowerment player from the transfer-of-skills perspective?
William Kirsh had better be careful. Those who live in glass houses cannot throw stones.
This column's argument is that Primedia cannot boast of empowerment credentials based only on MIC's financial interest in the group. Besides, Kirsh recently admitted that taking over Kagiso would have put Primedia under a lot of pressure, resulting in an unacceptably high level of gearing.
What's changed Willie? Is it about your empowerment credentials? You gotta be kidding me.