8,000 workers to benefit from Coca-Cola BEE scheme
Employees to own 20 percent of Coca-Cola as part of empowerment deal.
Coca-Cola Beverages South Africa (CCBSA) says 8,000 black workers are set to own 20 percent of the company in a new black economic empowerment (BEE) share scheme.
The agreement is part of the conditions of Coca-Cola’s 2016 merger with former partner SABMiller, now part of brewer Anheuser-Busch InBev. The Competition Tribunal gave the deal the go-ahead on condition it abided by several conditions, including increased worker ownership as well as localisation and procurement obligations. Workers currently hold about five percent of Coca-Cola equity.
Workers who participate in the scheme will also be able to nominate two non-executive directors to the board of Coca-Cola Fortune (CCF), the sole shareholder of CCBSA.
CCBSA managing director Velaphi Ratshefola said that the transaction, which is expected to come into effect in May, will be fully vendor-funded, meaning that workers will not be required to make any payments to purchase equity.
CCBSA has also entered into an R80 million investment agreement with the Department of Trade, Industry and Competition towards localisation initiative. In addition, CCBSA will increase procurement from black sugar cane farmers, a step that will see Coca-Cola and other industrial retailers and users of sugar procure at least 80 percent of their sugar needs from local sugar millers in 2021. This amount is expected to increase to 95 percent by 2023, according to minister of trade, industry and competition Ebrahim Patel.
“The commitment from CCBSA to increase the level of worker ownership in the company, deepen the level of transformation in the sugar value chain and support the broader localisation drive in the economy, are important steps in our efforts to create a more inclusive economy in South Africa,” said Patel.
The targets are in line with the Sugar Master Plan signed in November last year by farmers, retailers, workers and government.