Through our involvement and facilitation of BEE transactions, we understand how markets are changing and are able to identify new opportunities such as innovative solutions and cross-selling our products and services. These BEE transactions will ensure that we meet the charter requirements set for 2008.

In addition to the Tutuwa transaction, we were involved in advising, structuring, arranging funding, or underwriting the following empowerment transactions during 2004:

Incwala Resources (Proprietary) Limited: The establishment of Incwala Resources has played a role in empowering the platinum mining industry in line with Mining Charter targets.
Shanduka Resources (Proprietary) Limited: Shanduka Resources (Proprietary) Limited acquired a 42% equity stake in a new entity that owns Mondi’s South African newsprint business. Standard Bank took a 15% equity stake in Shanduka Resources (Proprietary) Limited.
Tiso Group Limited: Tiso was part of a consortium that acquired a 25,1% stake in AECI Limited’s South African and African explosives operations, African Explosives Limited. Standard Bank provided debt funding of R68 million.
Safika (Proprietary) Limited: Standard Bank has offered to purchase a 20% equity stake in Safika. This offer is subject to Competition Commission approval.
Xstrata South Africa (Proprietary) Limited: An empowerment transaction was structured and implemented by Standard Bank whereby a joint venture was entered into between Xstrata SA and South African Chrome and Alloys Limited. The transaction was valued at about R8,2 billion.
Defy Appliances Limited: Standard Bank was the lead financier in a transaction to acquire the business of Defy Appliances Limited in late 2004. Standard Bank provided acquisition funding to the consortium, which included an empowerment party, together with general short-term and derivative facilities for future operations. Standard Bank has a 49,9% equity stake in Defy.
Ayavuna Women’s Investments (Proprietary) Limited: Standard Bank provided R20 million start-up capital to a recently formed black-controlled investment company.

Targeted investment

The charter requires each financial institution to finance investment in four broadly defined target areas, namely:

low-income housing;
agriculture;
black SMEs; and
transformational infrastructure.

The total industry target for these four areas combined is yet to be finalised.

Standard Bank has developed strategies for increasing finance to these four areas that take cognisance of the need for collaboration and innovation across different business operations within the bank. The concept of an integrated human settlement is currently being developed to enable the bank to make a sustainable contribution to providing housing, employment opportunities and basic infrastructure to communities. These efforts will only be possible in partnership with government, hence Standard Bank is working in close collaboration with all levels of government to find commercially viable solutions to what have traditionally been considered high-risk investments.

Furthermore, Standard Bank is leading the industry in financing black SMEs. The team has developed a holistic strategy to financing, mentoring and providing other support services to black SMEs that will lead to business success for those SMEs who partner with us.