B-BBEE STRUCTURES
Transformation is a complicated framework for companies to deal with in South Africa. It is clear that the economy needs to be transformed to be more inclusive and to build a stronger foundation for future generations to prosper.
That said, the current broad-based black economic empowerment (B-BBEE) framework has been criticised on several fronts.
The legislation is at times unclear, and achieving the desired B-BBEE score can be challenging, as is configuring a transaction without compromising the tax integrity of the structure.
We assist clients in navigating this complex area of regulation in order to achieve the best commercial and social outcomes, as well as to comply with the applicable regulations.
If sensibly approached, a B-BBEE structure can elegantly balance the clear social imperatives in the country while also ensuring that a business achieves its best rating.
While there are many practitioners in the field, and a number of solutions touted, our team’s general transactional experience means that we can create bespoke solutions rather than
“squeeze· a client into a generic structure template. We can also provide ownership partners and funding solutions where required.
A number of clients have approached us to assist with restructuring their existing B-BBEE scheme.
These structures often were sub optimal, as they may have transferred insufficient n et value, adverse accounting consequences or may in hindsight have been insufficiently flexible.
Furthermore, changes in the value of the shares in question may have compromised the B-BBEE points associated with that scheme.
We assist clients to re-engineer existing structures to transfer a greater number of points, permit improved alignment between B-BBEE partners and the company, and reduce the cost of the previous scheme.
Solutions
Corporate Transactions
Financial Instruments