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Empowerment slows to a trickle
David McKay
Posted: Thu, 21 Jul 2005
[miningmx.com] -- EMPOWERMENT in South Africa’s mining sector slowed to a trickle in the 12 months to June 2005, according to a study conducted by independent research agency, Empowerdex. Interestingly, however, the resources index gained over 62% in value, a development that proved equity based deals became too expensive for empowerment firms, Empowerdex said.
“The total value of all resource deals between June 2004 and June 2005 was R5.7bn,” Empowerdex said. This compared with R15bn in empowerment deals in the 12 months to June 2004. The actual value of deals in 2005, from January to June, was R1bn.
“It is interesting to note that the bulk of all deals was conducted in 2003, at a value of R15bn, when share prices were at their lowest,” Empowerdex said. “Since then the index has gained 62%, signifying the astuteness of BEE (black economic empowerment) participants”.
Of the percentage of total deals, the largest was Gold Fields’ sale of its South African gold assets to Mvelaphanda Resources, comprising 60% of total deal-flow during the period. It was followed by Aquarius Platinum (13%), African Rainbow Minerals (12%), and Western Areas (8%), Empowerdex said.
Nedbank Capital was the largest sponsor of deals accounting for 34% of total deal flow during the period under review. It was followed by Sasfin Corporate Finance (26%). Equity transfer proved to be the most popular type of deal.
Board compositions remain firmly white dominated. White males account for 57% of all boards of listed mining companies followed by black female directors (29%), and black male executives (14%).
More empowerment graphs and
statistics can be found on pg 29 of the printed version of the 2005 Mining Yearbook. If you haven't yet seen it, feel free to mail info@miningmx.com for your complimentary copy.
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