South African Breweries (SAB) Zenzele chair Penuell Maduna says although the Covid-19 pandemic created disruptions and uncertainty to the domestic and global economy, the economy is “not tanking” and will soon be showing signs of recovery.
“The consequences of the pandemic and the lockdown were unavoidable … We are looking at a moment of take off but over time we will be in full flight as an economy,” he said.
Maduna made the comments on Monday during the launch of the company’s broad-based black economic empowerment (B-BBEE) scheme, Zenzele Kabili.
The second round of the share scheme will be launched at the end of May and will see shareholders own R5.4 billion worth of shares in global brewing giant Anheuser-Busch InBev.
The initial broad-based scheme launched in 2010 is one of the country’s biggest BEE share schemes, with 40 000 beneficiaries. SAB forecasts that the original scheme will have generated almost R14 billion in value for South Africa upon its unwinding in April last year.
Zenzele’s current 29 000 retail shareholders will be required to vote in favour of the Kabili share scheme at a special AGM on May 10. If approved the Kabili scheme will be listed as a company on the B-BBEE Segment of the Johannesburg Stock Exchange.
Publicly traded asset
Speaking at the event vice-president for finance at AB InBev Africa, Richard Rivett-Carnac, said: “SAB Zenzele Kabili will now have an asset that is a publicly traded share [with] very transparent pricing … [the listing on the JSE] provides liquidity for the participants whereas previously SAB Zenzele participants had to be very patient and waited 10 years before their payouts in dividends … which is a huge improvement.”
Those who invest in Zenzele Kabili will become global shareholders, receiving 25% in dividends annually, without having to wait 10 years before being able to sell shares or get paid out.
Additionally, SAB Zenzele Kabili shareholders will be able to trade immediately after listing, Maduna said in a statement in April.
SAB pushed back the launch of the Kabili scheme last year due to the Covid-19 outbreak which prevented shareholder scheme meetings from taking place and prevented beneficiaries from voting regarding payouts and reinvestment options.
The squeeze in the economy and the three bans on the sale of alcohol in South Africa during the course of 2020 resulted in SAB parent company AB InBev experiencing “double-digit volume, revenue and Ebitda [earnings before interest, taxes, depreciation, and amortisation] declines and significant Ebitda margin contraction,” the company said.
The launch of Zenele Kabili comes on the back of a projected 3.3% growth forecast by National Treasury for 2021 coming from a negative growth of 7.2% in 2020.