SAB Zenzele Kabili

SAB Zenzele Kabili offer lists a new B-BBEE scheme to own R5.4 billion worth of AB InBev shares

The South African Breweries (SAB) is pleased to announce that its broad-based BEE (B-BBEE) scheme, SAB Zenzele, will reach maturity in May 2021. A new scheme, SAB Zenzele Kabili, will launch in the same month to continue creating value for beneficiaries.

SAB Zenzele is the largest B-BBEE scheme in the history of South Africa in the fast-moving consumer goods sector, having reached a total maturation value of R9.7 billion.

Launched in 2010, the landmark SAB Zenzele transaction endeavoured to give our retailer partners – taverners, bottle store owners, retailer customers and our employees – the lifeblood of our business, an opportunity for real ownership in a company that has brought South Africans together for over 125 years. Retailer shareholders who invested R100 in 2010 will have received a total pretax payout of R77 518 when the transaction fully unwinds in May 2021.

SAB plans to continue this trajectory of empowerment and wealth creation for staff, retailers and beneficiaries of the SAB Foundation. The company is offering SAB Zenzele retailer shareholders the opportunity to reinvest a portion of their remaining proceeds in a replacement B-BBEE ownership transaction through the SAB Zenzele Kabili scheme that will own R5.4 billion worth of AB InBev shares.

SAB Zenzele Kabili will be listed on the B-BBEE segment of the JSE to facilitate liquidity and broaden ownership to other B-BBEE investors, including qualifying SAB employees, through a new employee stock ownership plan.

SAB Zenzele was scheduled to unwind in March 2020, with SAB Zenzele Kabili envisioned to launch shortly thereafter. However, restrictions driven by Covid-19 prevented the necessary shareholder scheme meeting from taking place, at which time beneficiaries would have voted regarding payouts and reinvestment options.

The SAB Zenzele board, together with SAB, recognised at the time that such postponement would have a significant negative impact on the anticipated cash flows of shareholders, which had been exacerbated by the pandemic.

The board subsequently resolved, together with SAB, that each SAB Zenzele retailer shareholder would be paid a cash amount equal to 77.4% of the calculation of its right and entitlement from the unwind of SAB Zenzele, less applicable costs and taxes. This cash payment, which amounted to R3.49 billion, took place in April 2020.

If Zenzele Kabili becomes operative, it will be listed on the B-BBEE segment of the JSE on May 28 2021. From this date onwards, anyone wanting to buy shares needs to qualify as a black person and can acquire them through a JSE broker or any trading platform they may already use.

The remaining entitlement of SAB Zenzele retailer shareholders is therefore 22.6% of the calculation of their right and entitlement from the unwind of SAB Zenzele, as at the date of the unwind, adjusted for inflation over time.

In a video address to shareholders, SAB Zenzele chairperson Dr Penuell Maduna announced that the scheme meeting would now take place on May 10 2021, in a digital environment where beneficiaries will vote regarding reinvestment of this portion.

He explained that those who reinvested into SAB Zenzele Kabili would henceforth become global shareholders, receiving 25% in dividends annually, without having to wait 10 years before being able to sell shares or be paid out. Additionally, SAB Zenzele Kabili Offer shareholders would be able to trade immediately after listing.

“We all want to build a prosperous future for ourselves and our families. At SAB, we understand that this takes hard work and good partnerships,” said Maduna. “SAB Zenzele Kabili Offer is set to be our biggest success yet, and, despite these tough times, it’s time for a new scheme for new dreams and ownership for all.”

How SAB Retailer Shareholders can be a part of SAB Zenzele Kabili Offer

SAB is brewing a brand new empowerment share scheme, SAB Zenzele Kabili, to be listed on the B-BBEE Segment of the Johannesburg Stock Exchange, and set to be SAB’s biggest success yet.

Worth R5.4 billion in global ABInBev shares, the scheme will only go ahead if voted in by SAB Zenzele Shareholders.