SA's leading PR firm sells 51% stake to black executive directors
Vuma Reputation Management is the latest firm to up its empowerment credentials in order to comply with the empowerment charter in the marketing, advertising, and communications (MAC) sector.
Vuma joins a throng of companies that have concluded broad-based economic empowerment (BB-BEE) transactions in line with the sector’s charter, which has set a target of 45% black equity ownership by March 2018.
The Johannesburg-headquartered reputation and crisis management company has sold a 51% empowerment stake to three executive directors of the company for an undisclosed amount.
Sasol points to vendor financing as holy grail of BEE funding
Hard lessons have been learnt from the last two waves of black economic empowerment (BEE) transactions, dating back to the late 1990s. Previous incarnations of BEE have highlighted the importance of structuring BEE financing in a way that boosts investors’ chances of generating value from their investments.
Observers of BEE policy have in the past questioned the manner in which such transactions were financed and structured, arguing that expensive and inflexible funding eroded value for black investors, particularly investments that are caught up in under-performing sectors with depressed share prices and earnings.