Direct Empowerment

Broad-based black economic empowerment (BBBEE)

PHUTHUMA NATHI

 

Through a combination of shareholding in Naspers and the Phuthuma Nathi share schemes, black South African individuals and groups own 30% of MultiChoice South Africa. The Phuthuma Nathi and Phuthuma Nathi 2 share schemes were launched in 2006 and 2007, respectively. In September 2011 Phuthuma Nathi and Phuthuma Nathi 2 received ordinary and special dividends declared by MultiChoice totalling R1,2bn. The ordinary dividend of R300m was up 25% from the prior year, and a special dividend of R900m was used to reduce funding. On 8 December 2011 shares in Phuthuma Nathi and Phuthuma Nathi 2 began public trading.

 

WELKOM YIZANI

 

In 2006 Media24 launched the largest BBBEE share offer in the print media industry, Welkom Yizani, resulting in eligible black people and groups owning some 15% (directly and indirectly) in Media24 Holdings. In December 2009 to mitigate the impact of the recession on the value of these shares, Naspers wrote off R330m of its funding in Welkom Yizani and the scheme was extended by two years to December 2013, providing Welkom Yizani shareholders a better opportunity to profit from their original investment despite the recession.

Black economic empowerment partners

Media24, MultiChoice and other group companies have combined their buying power in South Africa in a centralised bargaining company, CommerceZone. Suppliers’ BEE performance is evaluated against specific criteria and they are expected to boost their annual BEE rating.

 

The MultiChoice preferential procurement programme supports the development of small, medium and micro-enterprises (SMMEs). In addition, these SMMEs are given opportunities to tackle larger-scale projects, enabling entrepreneurs to develop their skills and capabilities. The last three years have seen a lifting of MultiChoice’s preferential procurement spend, from 47% in 2009 to 67% in 2012, on BEE-compliant companies. This equates to over R4,9bn spent with BEE-compliant companies.

MultiChoice has 111 agencies nationally, of which 40 are owned by previously disadvantaged business people. These agencies provide employment for approximately 200 people including the owners of the businesses. During the financial year under review MultiChoice spent R15m on these agencies, excluding capex already invested during the set-up stage.

MultiChoice has a network of 1 200 accredited installers across South Africa. A total of 389 are black owned and 49 are owned by women. MultiChoice provided the black-owned installers with laptops at a cost of R3m to assist them in activating subscribers.

In addition to its own empowerment initiatives, MultiChoice buys large numbers of decoders from a local manufacturer. These decoders are also exported to countries outside South Africa. During the reporting period approximately 1,4 million decoders with a value of some R500m were exported. This has created employment opportunities in the areas of manufacturing, logistics and sales.

Furthermore, enterprise development initiatives have created more than 620 jobs across the Paarl Media group.