SAB BEE deal

[#1]

Hi guys, I was just wondering about the BEE deal? Whats happening with that and is it a deal that involves normal individuals or is it something for Taverns and shebeens and small business who sell alcohol? Thanks

[AJT]

It is available to all BEE employees and white employees below a certain grade. It is also applicable to shabeen owners, etc. The valuation has been done based on the value of SAB South Africa and the BEE deal concludes in 10 yeards time, i.e. individuals can only cash in, or swop their BEE shares for SABMiller Listed shares in 10 years..

[HateGauteng]

Not sure if I like my money to be tied up for 10 years. Theres no guarantees that SAB will increase in value over that period! Rather risk the money on derivatives.

[#4]

So I assume individuals/general public can't participate?

[AJT]

correct, public cannot participate. @HateGauteng - employees money is not tied up, as they do not need to put any money in. If they stay with the company for another 4 years, they will be entitled to the full contribution; there are other stipulations should employess leave within 1; 2; 3; etc years where they are entitled to a portion of their shares. Dividends are also granted during this period, but a portion (think it is 25%) is held back in order to go towards funding the deal, so essentially it is money for nothing....

[HateGauteng]

schweet for the employees

[SimonPB]

there is more chance of SAB going up then there is of the avergae person making money from derivatives ..

[HateGauteng]

At least the average person doesn't have to put up with their money tied up in a BEE deal for years to come. Sometimes, I wonder about the feasibility of the average (not this one as explained below) BEE deal. As a person (or family) develops over the years, could this money be put to better use such as childrens (or their own) education.

[SimonPB]

but if you are an investor with a 5-10 year view, then youu're getting the shares at discount whhich would certainly be attractive.

[AJT]

maybe so, but those that took up the Sasol BEE deal will not be smiling right now, let's hope they are in a few years time...

[SimonPB]

well sure, top of the market transactions never much fun ..