Media24 today announced that it will assist its Welkom Yizani BEE shareholders by revising the terms of the Welkom Yizani black economic empowerment (BEE) share scheme. This follows the decline in the global economy that has had a severe impact on the media industry.
According to Francois Groepe, Media24 CEO, the recessionary conditions prompted the company to be proactive and responsible. "Media24 wants to be proactive in assisting the shareholders of Welkom Yizani. The shareholders are important to us and we believe it is our responsibility to assist them in the current economic environment. The actions that we intend taking will help ensure that shareholders have a fair chance of making money when the scheme matures," said Groepe.
A task team has been assigned to develop the assistance plan. An announcement will be made as soon as the proposals have been finalised and approved. To assist Welkom Yizani, Naspers will reduce the debt by some R330 million, while the minimum investment period will be extended by two years.
"The original offer price was R50 per share, of which shareholders invested only R10 per share. Naspers Limited financed the balance, to be repaid over ten years," he says.
At the time of the scheme's introduction in September 2006 at an offer price of R50 per share, the Welkom Yizani BEE offering was considered the largest of its kind in South Africa's print media industry.
Through the company called Welkom Yizani Investments, all eligible black South Africans had the opportunity to buy an indirect stake in Media24. All eligible black South Africans could take part in the share offer for a minimum investment of R200. The offer was oversubscribed, resulting in a maximum investment of 430 shares per individual. Today, Welkom Yizani has over 107 000 shareholders.
A general meeting of all Welkom Yizani shareholders will be held to approve the assistance plan. A circular to shareholders on the proposed plan will be distributed in November.