SABMiller announces BEE deal

Participants will include SAB's employees; black-owned licensed liquor retailers and liquor licence applicants, as well as black-owned customers of ABI, the soft drinks division of SAB and the broader South African community through an SAB foundation.

The transaction will target an estimated 60,000 new shareholders, of whom over 95% are estimated to be black individuals or black majority-owned enterprises, and will hold SAB Ltd shares through separate investment entities.

After the ten-year transaction period, SAB shares will be exchanged for SABMiller shares.

The transaction will equate to an effective 16% BBBEE transaction in terms of the BBBEE Codes of Good Practice.

The full terms of the transaction are expected to be finalised in November 2009 and the offer is expected to conclude in the first half of 2010.

The transaction will materially enhance SAB's compliance with the South African government's Codes of Good Practice on Black Economic Empowerment while also seeking to support the normalisation of the South African liquor industry by supporting liquor licensing in South Africa.

"We have structured this transaction to maximise benefits for all our stakeholders and to deliver genuine broad-based black economic empowerment," SABMiller chief executive Graham Mackay.

"There are three innovative and distinctive features of this transaction. Firstly, the transaction places no reliance on external bank funding, and requires only a relatively small and hence affordable cash investment from retail participants.

"Secondly, a meaningful dividend stream is expected to be paid to all participants for the whole of the ten-year transaction period, thereby delivering a significant economic benefit from the first year.

"Thirdly, the transaction aims to benefit the stakeholders who have made a real contribution to SAB's success as well as the broader South African community through the SAB Foundation," he said.

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