Van der Merwe pointed out that it was particularly relevant in private owner-managed businesses which do not have the pressure of public scrutiny. In these instances private equity brings an institutional mindset, which is beneficial for smaller and medium-sized entities in many respects, including the way in which they approach empowerment. A large share of private equity deals are BEE transactions According to the SAVCA/ KPMG Venture Capital and Private Equity Industry Survey of South Africa 2012, the number of private equity investments into BEE entities (defined as entities that are at least influenced”) totalled 192 in 2012, with a value of over R6bn. “black Further categorisation of these BEE deals shows that 29% were into black-influenced companies, 14.5% into black-empowered companies and 56.5% into black companies. Fund managers increasingly empowered, too At the private equity manager level, meanwhile, empowerment progress has been made in the last 10 years. According to same survey, at the end of 2012 there were R65.8bn funds managed by managers with empowerment credentials (that is, by government agencies or by private sector managers who are at least black influenced). At the end of 2003, the number was R8.7bn. As a proportion of the industry, this signifies encouraging gains: While only 35.4% of private equity funds under management in 2003 had an element of empowerment, this had risen to 75% of funds under management in 2012. Definitions: Black influenced: Between 5% and 25% owned by black people and with participation in control by black people. Black empowered: More than 25% (but less than 50%) owned by black people. Black companies: More than 50% owned by black people, and controlled by black people. ENDS About SAVCA The South African Venture Capital and Private Equity Association (SAVCA) is the industry body and public policy advocate for private equity and venture capital in South Africa, representing about R120bn in assets under management.
Van der Merwe pointed out that it was particularly relevant in private owner-managed businesses which do not have the pressure of public scrutiny. In these instances private equity brings an institutional mindset, which is beneficial for smaller and medium-sized entities in many respects, including the way in which they approach empowerment. A large share of private equity deals are BEE transactions According to the SAVCA/ KPMG Venture Capital and Private Equity Industry Survey of South Africa 2012, the number of private equity investments into BEE entities (defined as entities that are at least “black influenced”) totalled 192 in 2012, with a value of over R6bn. Further categorisation of these BEE deals shows that 29% were into black-influenced companies, 14.5% into black-empowered companies and 56.5% into black companies. Fund managers increasingly empowered, too At the private equity manager level, meanwhile, empowerment progress has been made in the last 10 years. According to same survey, at the end of 2012 there were R65.8bn funds managed by managers with empowerment credentials (that is, by government agencies or by private sector managers who are at least black influenced). At the end of 2003, the number was R8.7bn. As a proportion of the industry, this signifies encouraging gains: While only 35.4% of private equity funds under management in 2003 had an element of empowerment, this had risen to 75% of funds under management in 2012. Definitions: Black influenced: Between 5% and 25% owned by black people and with participation in control by black people. Black empowered: More than 25% (but less than 50%) owned by black people. Black companies: More than 50% owned by black people, and controlled by black people. ENDS About SAVCA The South African Venture Capital and Private Equity Association (SAVCA) is the industry body and public policy advocate for private equity and venture capital in South Africa, representing about R120bn in assets under management.
SAVCA-Media-Release-BEE-July-2013.docx