Agreement over Foskor BEE deal

Johannesburg - The Industrial Development Corporation (IDC), phosphate producer Foskor and the BaPhalaborwa community have reached an agreement regarding the latter's participation in the IDC and Foskor's broad based Black Economic Empowerment transaction (BEE).

In a statement on Monday, the parties said that the terms of the agreement were consistent with those announced on July 8.

"The BaPhalaborawa community will participate in a community trust that will control five percent of the phosphate producer and is split between the BaPhalaborwa and the Richard's Bay community who will control 2.5 percent and two percent of the community trust, respectively," the statement said.

Foskor has a phosphate mining and beneficiation operation in PhalaBorwa and a phosphoric acid and granular fertiliser plant in Richard's Bay.

"We are satisfied with the outcome of our talks with the IDC and Foskor," said BaPhalaborwa community spokesperson Steve Ramalepe.

"We are happy to participate in the empowerment transaction and to take up our role in the community trust, the terms and structure of which we are now fully supportive," he added.

Similo Sibisi Foskor's Vice President-Corporate Affairs said the news of the agreement was welcome.

"Foskor already plays a strong role in South African society by supporting agrarian reform and emerging farmers.

"The bedding down of the empowerment transaction allows us to focus on strengthening the impact of our contributions to the communities in the vicinity of our operations."

IDC chief economist Lumkile Mondi said he was glad that an agreement had been reached with the BaPhalaborwa community.

"As the IDC, it is important that our facilitation of Broad Based BEE should support our strategic goals of increasing economic participation and broadening geographical economic activity.

"The BaPhalaborwa community's active participation in the trust will help in ensuring that the benefits that flow out of this BEE transaction have a sustainable and tangible socio-economic impact."

Last month the state-owned IDC announced the successful bidders for a 26% broad-based BEE stake in vertically integrated phosphate and phosphoric acid producer, Foskor.

Following a competitive bidding process, inviting participation from black business consortia and special interest groups, the IDC and Foskor chose 12 consortia, the Manyoro consortium, who acquired 15% of Foskor's issued share capital.

The remaining 11% was split between two special purpose vehicles for staff and local communities which incorporates a trust for communities in the vicinity of Foskor's operations in Phalaborwa and Richard's Bay, while another special purpose vehicle controls an employee share ownership scheme for Foskor's 2,000 employees.

- Sapa