Balwin secures approval for BEE transaction

Aobakwe Reginald Kukama and Steve Brookes, Balwin Properties

“I’ve been working on a suitable empowerment transaction since listing and Balwin is delighted with the shareholder support received to implement the transaction. Transformation has always been very close to Balwin,” commented Steve Brookes, CEO of Balwin Properties,in a statement.

A special purpose vehicle owned by Black shareholders (BEE SPV) will subscribe for 47,219,260 newly issued Balwin shares, and the total subscription price will be 455 cents less a 20% discount. According to Balwin, the BEE SPV will be controlled by Kukama, who holds 51% of the shares in the SPV, a Black female will hold 24% and Black youth will hold the remaining 25%.

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10-year lock-in clause

According to Balwin, the BEE SPV owners will pay R20m of their own capital towards purchasing the newly issued shares, with the balance to be repaid from the proceeds of dividends and own contribution cash top-ups over the next ten years. There is also a lock-in clause of 10 years during which the shareholding may not be disposed of or encumbered.

"In addition to the phenomenal work done by the Balwin Foundation, the operational side of Balwin has made considerable efforts in transforming our business over the past number of years in support of the principles and objectives of the Black Economic Empowerment Act. This transaction will further improve our BEE scorecard rating," Brookes said.