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Johannesburg - Foskor, which mines and manufactures phosphates, on Wednesday unveiled terms of an empowerment deal in which it will part with 26% of the company to a consortium and two special purpose vehicles, including an employee share option plan.
Foskor, controlled by government's Industrial Development Corporation (IDC), also raised the prospect of a listing within six months.
No value was placed on the transaction, but if Foskor pursues a listing in 2009, the acquisition cost will be based on its initial public offering price, the IDC said. The company's shares would be independently valued if it did not list.
"The transaction is in line with one of the IDC's core objectives of broadening economic participation and facilitating industry development," said IDC CEO Geoffrey Qhena at the company presentation in Johannesburg.
The main beneficiary of the deal is the Manyoro Consortium which consists of 12 discrete parties and will buy 15% of the company. The remaining 11% is divided between two special purpose vehicles for staff and local communities. This includes a share ownership scheme for 2 000 Foskor employees.
"The high level of interest from strategic business partners and broad-based groupings highlights the strength of Foskor as a business and the attractiveness of its shares as a BBBEE (broad-based black economic empowerment) investment," said Qhena.
The IDC will fund the entire consortium. All BBBEE parties are required to make an equity contribution in proportion to their direct stakes, the IDC said. It would retain 59% ownership of Foskor.
Said Alfred Pitse, CEO of Foskor: "We are now geared to meet the requirements of the Minerals and Petroleum Resources Development Act of 2002, the Codes of Good Practice and the Codes of Good Practice for the South African Minerals Industry (2009), necessary to obtain our new order mining rights."
Foskor produces phosphate acid after mining phosphate ore at its Phalaborwa operations in the Limpopo province. Phosphoric acid and fertilizer production takes place in Richards Bay in KwaZulu-Natal.
- Fin24.com
