Integrated equity and debt specialists Bravura recently structured an empowerment transaction on behalf of IT and business consultancy IZAZI Solutions. Currently one of the premier consulting companies to the South African banking industry, IZAZI wished to enhance its already empowered profile through the introduction of a broad based further BEE shareholder who could assist IZAZI in attaining its broader business goals. Given the transaction and track record of IZAZI, they are well positioned to entrench themselves as a preferred supplier of technology services.
The Financial Services Charter, published late last year, requires that financial services institutions procure 50% of the value of all products and services they consume from BEE accredited companies by 2008 and 70% by 2014.
Says Bravura executive director Soria Hay, "Procurement has emerged as the new `stick` behind empowerment. IZAZI`s BEE transaction ensures that the company will continue to be able to offer its services to the financial services industry in the future."
Bravura`s first task was to find the right BEE partner for IZAZI. "We don`t believe in wide ranging roadshows. Investors dislike competing for a transaction and will often withdraw when they think a bidding war might ensue. Instead, we do our homework up-front, carefully targeting the right investor, then putting together a meticulous proposal that sells the concept. In this way, we short-circuit the process and position our clients for a successful transaction," Hay explains.
The partner Bravura introduced to IZAZI is broad-based BEE player the Mineworkers Investment Company ("MIC") which wasestablished and is wholly owned by the , the investment arm of the Mineworkers Investment Trust which was founded by the National Union of Mineworkers. In terms of the transaction, MIC now owns 25.1% of IZAZI culminating in a black shareholding of 64%. As part of the agreement, Bravura assisted in defining and building in performance parameters and an associated exit strategy should the relationship prove unfruitful.
"We believe it is important for empowerment partners to actively contribute to shareholder value," Hay explains.
IZAZI`s vision is to become the premier provider of technology-enabled business solutions to the banking sector. While currently operating primarily in the micro-lending, tier two and quasi-government financial institutions, IZAZI are actively expanding their footprint in the tier one banking space. In conclusion, Hay contends that its new ownership profile will assist IZAZI in this regard.
Corporate and structured finance specialists Bravura offer a holistic approach to equity and debt structured solutions, optimising investment returns with the application of innovative and lateral business strategies and income statement and balance sheet structuring. In addition, the company differentiates itself by its specialised focus on specific industries such as services, financial services, information technology, retail and BEE transactions.
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