Simeka Business Group is in talks around a potential empowerment deal, which could affect the value of its share price.
The company has not disclosed the nature of the transaction, its value or whether it will issue shares to enable the deal. However, Simeka BSG says it is determining the impact of a transaction on its shareholders, as a possible deal could affect the price of its shares.
Simeka BSG states on its Web site that it is majority black-owned, managed and many of its staff members are also black. At least 90% of Simeka's board of directors is black, of which 27% are black females.
Its latest Codes of Good Practice scorecard, which was issued by Empowerdex last September, indicates the company is a level four BEE contributor. An empowerment deal may aid it in moving up the empowerment ladder towards level one, the highest possible level.
The empowered group is involved in outsourcing, business support services and technology. It has been listed on the JSE's Alternative Exchange since 2004, and has a presence in SA, Africa, the Middle East and the UK.
In its latest results for the six months to November, Simeka BSG reported revenue down slightly to R372 million from R393 million. However, headline earnings almost halved, going from R42.6 million to R22 million.
The company is expected to report its full year results next Monday, and previously said revenue will be between 5% and 10% lower, while headline earnings after tax will be between 45% and 50% lower.
On Friday, its shares closed unchanged at 16c.
As Simeka BSG is trading under a cautionary, it is not in a position to discuss the deal.
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