The Mineworkers Investment Company (MIC) recorded a 22% rise in the net asset value of its portfolio to R2.8 billion in the 12 months ended February 2012.
The results came to show remarkable resistance by the board based black economic empowerment company in the face of headwinds that have frustrated its peers on the market.
MIC is a broad-based BEE Investment Company established in 1995 by the Mineworkers Investment Trust (MIT) to create a sustainable asset base for the benefit of mine, energy and construction workers and their dependants.
The MIC investment portfolio covers various sectors, including financial services, media, technology, industrial groups, food and leisure. Further diversification is expected in the new era.
MIC CEO Mary Bomela said the group will be seeking to further diversify its portfolio. “We will be seeking opportunities in sectors where we are currently not invested and balancing the mix between listed and unlisted investments. Most attractive to us are annuity-based businesses, with high growth prospects, strong management teams.”
MIC said it was eager to pursue opportunities in healthcare, retail and telecommunication sectors and was looking at emerging opportunities in the infrastructure value chain.
Bomela said government efforts to combat fronting could create demand among some private-sector businesses for “more credible black empowerment partners”. MIC was well placed to respond.
There may be secondary empowerment opportunities as some first-generation empowerment investor’s look for an exit to realise value.
Exit to date may have been blocked by lock-ins, market conditions and the requirements for business to remain empowered.
Bomela said “In this scenario, MIC can unlock value for the existing empowerment investor and acquire sometimes substantial shareholdings without jeopardising a company’s empowerment status.
“Secondary BBBEE transactions like this will enable us to grow our investment portfolio while ensuring empowerment gains are entrenched at some substantial businesses.”
MIC achieved Level 2 empowerment status during the review period and noted pleasing improvements of the BEE score at a number of its investee companies.
“MIC has a strong balance and relatively little debt. This gives us a robust platform from which to achieve further growth. MIC has withstood significant challenges over the last five years; giving us every reason to look forward with confidence to the challenge of our next five-year cycle.”