WOMEN’S Development Bank Investment Holdings (WDBIH) has invested R500m into acquiring shares in Woolworths through a bookbuild process.
WDBIH signed a R100m cheque from its own cash resources and leveraged off its balance sheet by using some debt to top up.
The female-led and black-owned WDBIH said it had the appetite to take up more shares in Woolworths should the retailer pursue a black economic empowerment (BEE) transaction in the future.
Last month Woolworths said its staff had cashed out close to R2bn after selling shares following the maturity of the company’s BEE employee share ownership scheme that was initiated eight years ago.
To manage the exit of some staff efficiently, the retailer then initiated a bookbuild process.
WDBIH took advantage of the bookbuild and picked up about a quarter of the shares allocated in the process, WDBIH CEO Faith Khanyile told Business Day.
She said WDBIH took about 5-million shares out of about 20-million shares that were for sale to institutional investors.
"We have recently made an investment into Woollies. We are hoping that by participating in the bookbuild we can position ourselves for a future BEE deal that may come."
This is the second bookbuild WDBIH has taken advantage of this year. Earlier in the year, when the FirstRand empowerment deal paid out, WDBIH put in R100m of its own cash to participate in a bookbuild.
This means that so far this year WDBIH has invested R200m from its own cash resources in bookbuilds.
The 19-year-old WDBIH, which was formed to make a difference in the lives of rural women and communities, is owned by the WDB Trust whose trustees include businesswoman Daphne Mashile-Nkosi, former CEO of then Wooltru Group Colin Hall and former first lady of SA and the founder of the WDB Trust Zanele Mbeki.
So far WDBIH has total assets of just more than R5bn and a net asset value of close to R3bn. It counts among its listed investments FirstRand, Discovery, Bidvest, Ascendis Health and property company Safari.
Unlisted investments include Assupol, Masana Petroleum Solutions and Algoa FM.
"The objective is to increase our stakes in Ascendis and Safari," Ms Khanyile said.
She said WDBIH invested in Safari not just for commercial returns but because it is a property fund focused on townships. "We are an investment company with a conscience.
"We are not investing for the sake of it. We want to see how we can marry investing with commercial returns and social impact," Ms Khanyile said.
She added that WDBIH had distributed about R165m in dividends to the WDB Trust and these were used to champion women and community causes.
The WDB Trust has a charitable programme called Zenzele focused on rural households. In the programme the trust employs social workers who visit rural communities to identify basic services the communities may need.
The programme then connects the poor households with relevant state departments.
Going forward, WDBIH said it was looking to invest in mid-cap companies.