The local arm of German engineering multinational Siemens has almost overhauled its 10 years old black economic empowerment (BEE) transaction by replacing its 15% old time local equity partner with its employees.
Siemens SA announced today that its 15% shareholding previously owned by New Africa Millennium Telecommunications (Africom) has been bought by a newly established Siemens Employee Share Ownership Trust. Africom earned the 15% in 2000 in transaction which also brought in Sekunjalo Investment Holdings as another 15% partner bringing Siemens BEE equity to 30%. Sekunjalo retains its 15%, said the group.
“The Employee Share Ownership Trust is our commitment to broad-based black economic empowerment that will essentially allow eligible employees to share in the long-term success of the company”, said Siegmar Proebstl, CEO of Siemens Africa.
The latest deal will hand Siemens superior BBBEE credentials in that it introduces an ESOP factor which draws more points from the empowerment scorecard. The deal also sets Siemen’s apart from other multinationals who have chosen to exploit the equity equivalence principle provided for in the BBEEE codes of good practice. This principle allows Multinationals to bypass the ownership element of the BBBEE scorecard and replace it with an equivalent socio economic development type investment.
“Our new B-BBEE shareholding will add significant business and financial value to our company, as it will make Siemens a stronger company for our customers and partners”, says Proebstl. “All employees of Siemens will benefit as it will contribute to our goal of being one of Africa’s leading electronic and electrical engineering companies”. Eligible previously disadvantaged employees of Siemens Limited and its subsidiary companies in South Africa will be the beneficiaries of this Trust.
Proebstl said Siemens commitment to B-BBEE extends well beyond shareholding. “Our focus is on local value creation through initiatives that support society and education advancement, job creation and skills development”.
He said evidence of this commitment to B-BBEE can also be seen in the constitution of its executive management representatives at board level. Transaction Siemens also unveiled new appointments to its executive team. Dall’Omo and Rita Nkuhlu have joined Siegmar Proebstl and Alex Mathole on the Siemens
SA Board making this the company’s first executive management team with 75% women and 50% Black representation.