It came as no surprise that Primedia topped this year's Top Empowerment Companies survey for the third time in a row. Primedia is by far one of the most empowered companies on the JSE, so it is unfortunate that it might be delisted later this year because of a private equity deal.
But the deal will allow Primedia's empowerment partner, the Mineworkers' Investment Company (MIC), to increase its economic interest in the company to 50% from 20%. Together with the Kirsch family, MIC has joint voting control of 48% of the company. However, Primedia minorities have been offered a R6bn buyout by a consortium led by MIC and the Kirsch family. This will enhance the status of MIC in Primedia.
It is a pity that this media giant, which owns radio stations 702 Talk Radio, 94.7 Highveld Stereo and part of Kaya FM in Gauteng, will be lost to the JSE after the deal. Primedia also owns various exciting assets such as CommutaNet, Primedia Outdoor, a 40% stake in football club Kaizer Chiefs, and a 50% stake in eXactMobile.
Primedia also led the way with black representation at board and executive management level. With an overall score of 63% on all empowerment segments - equity, board and management representation, employment equity and preferential procurement - Primedia was way ahead of its nearest rival, Kagiso Media.
Kagiso's overall score was 37,99%. The company's roots can be traced to Soweto in the 1980s when Kagiso Trust was formed as a vehicle to source donor funds for community projects.
The trust owns about 55% of Kagiso Trust Investments (KTI), which in turn owns the controlling stake in Kagiso Media. It's an exciting black equity holding, but the company is lagging in a number of areas such as black management representation, board participation and equity at top-management level. Primedia scored 9,39% on employment equity compared with Kagiso's 4,45%. At senior management level, Primedia scored 34,5% for black representation compared with Kagiso's 15%. Primedia also leaves competitors behind in preferential procurement, with a score of 41,7% and an overall score of 10,7%.
However, Kagiso's black equity holding puts it in a strong position for the future and it is to push for more black executives in top positions.
Naspers, fifth this year, concluded a broad-based BEE deal at the end of last year through its operating divisions Media24 and MultiChoice SA. Media24 offered 14,6m of its ordinary shares for R50 each to a new company called Welkom Yizani, which sold the same number of shares for R10 each to the public.
Black investors were also invited to buy a 15% stake in MultiChoice SA, the pay television provider, through Phuthuma Nathi Investments. This does not include voting rights. Naspers will fund 80% of both schemes.
Johnnic Communications was rated third. How different it could have been had Johncom concluded its long-awaited BEE deal.
