[A-List] South Africa: equal opportunities capitalism?

["Michael Keaney" <michael.keaney@xxxxxx>]

South Africa miners to give up 26% of equity
By Saeed Shah
The Independent, 11 October 2002

The South African government plans to force the country's mining companies
to hand over 26 per cent of the industry to black-owned businesses within 10
years.

The proposal, contained in the Mining Charter, published in final form
yesterday, does not go as far as an earlier leak of the document, which
suggested that 51 per cent of the industry be handed over to black-owned
businesses.

Since that leak, the white-dominated mining industry, led by the biggest
player, Anglo American, has lobbied to get the redistribution of assets
watered down, and the sector welcomed the final proposal yesterday.

Not only has the quantity of assets that must be transferred been reduced,
but the Charter now makes clear that the assets will go to blacks on a "fair
value" basis. It was feared after the initial leak that mining companies may
be forced to give assets away. However, fair value may not always be the
same as "market" value.

The South African mining giant said: "Anglo American believes that the
broad-based Empowerment Charter is a practical approach to achieving
transformation in a way that marries the requirements of international
competitiveness and the interests of the existing investors in companies,
with the commitment by all stakeholders to promote a more inclusive
industry."

The government also insisted that companies must help finance the 100bn rand
(£6bn) needed so that blacks can buy 15 per cent of the industry in the next
five years. The industry will not provide the money but it must guarantee
the loans, which will come from banks.