Monday, 28 June, 2004
Nellie Brand, www.dieburger.com
This comes after Wiese stepped into the battle for the controlling share in KWV that has been waged for more than a month. A Stellenbosch group, Anglo African Trade (AAT), wanted to buy a large share in the company.
An announcement was made on Thursday that a consortium, made up of Wiese and the KWV's Employee Empowerment Trust, agreed to buy back a share of nearly 20% from AAT and other shareholders (known as the AAT consortium).
The shares involved were bought for about R157m. About 85 million shares were bought at R1.85 a share, 25c a share more than what AAT bought them for.
Danie de Wet, chairperson of KWV, said on Thursday that Wiese had saved the beleaguered alcohol giant from a potential embarrassment.
'Without Wiese's intervention, an empowerment transaction in which KWV was trying to play a leadership role in the wine industry would not have been possible.'
Under the terms of the empowerment transaction, a share of 25.1% has been promised to a black empowerment consortium. The nature of KWV's shareholding (the company has more than 7 000 shareholders) would have made it impossible to buy the interest of the shareholders, especially after AAT was the first to make an offer to the shareholders.
Each shareholder must be willing to sell about a quarter of his or her shares.
This left KWV in a tight spot because the only other option would have been to issue shares and this would have devalued shareholding in the company.
De Wet said the new offer "stabilised" and consolidated the ownership of KWV.
Wiese already has sizeable investments in the wine industry as owner of the Lanzerac and Lourensford estates.
'The significant interest he is expected to hold in KWV supports his trust in the potential of the company and the competitive ability of the local wine industry,' KWV said in its statement.
Apart from Wiese, Phetogo (21.5%) and the producers' organisation VinPro (10%) would be the largest stakeholders in KWV after the transaction and the black empowerment initiative are finalised.
Wiese is expected to hold between 10% and 15% of KWV. His involvement is considered to be 'friendly'.
In contrast, KWV described AAT's bid as sinister and 'hostile'. AAT indicated that it had strategic long-term plans for KWV.
However, rumour has it that the group approached its shareholders soon after the offer to sell again.
The 85 million shares apparently include members of a group of shareholders previously known as Group of Five. This group used to include GT Ferreira, Pug Roux, Paul Meaker, Hannes van Niekerk and Thys du Toit.
The empowerment consortium Phetogo will now proceed with its proportional offer to shareholders in order to buy 112 million shares.
This article first appeared on: www.dieburger.com