Edward West | 10 July 2023
AVI, parent company of I&J, has abruptly terminated a long-standing BBBEE partnership with a consortium led by prominent entrepreneur and former anti-apartheid activist
A major corporate standoff is brewing between one of South Africa's largest fishing groups, I&J Ltd and its empowerment partners over lucrative fishing rights.
AVI, parent company of I&J, has abruptly terminated a long-standing BBBEE partnership with a consortium led by prominent entrepreneur and former anti-apartheid activist Khusta Jack.
Jack, chairman of Main Street 198 Ltd, was asked to resign voluntarily or face removal from the board as I&J starts a new partnership with a different group of BEE partners. Jack has slammed AVI for adopting what he says is a revolving door approach to dealing with its BEE partners.
"I told them I will not resign under duress. This is a vile perversion of the spirit and principles that underpin the policy of broad-based black economic empowerment, and endeavours towards achieving economic transformation.
"We are going to assert our rights. We are going to escalate this matter to the Minister of Fisheries and Environmental Affairs Barbara Creecy and the BBBEE Commission. “We feel we have been used and then cast aside,” said Jack.
He said I&J had won lucrative, long-term commercial fishing rights from the government just over a year ago, in part because of their empowerment credentials flowing from their partnership with Main Street which until the abrupt termination of the deal last week held 20% of I&J shares.
“If it wasn't for our participation I&J would never have been awarded those highly valuable commercial fishing rights. I&J applied for those rights on the basis of the 20% shareholding attributable to our empowerment group.
“But now that the rights have been awarded and AVI has got them in the bag they turn around to us and say you can go now we have found new BEE partners.
“How does any well-respected corporate entity treat its business partners in that fashion it has had a long and successful association with?
“We are simply told to move on to make way for a new BBBEE entity which had no role in the group when the fishing rights were applied for and awarded.
“As a result we will derive no benefit whatsoever from the long-term rights that our involvement was instrumental in securing.
“This is the most vile perversion of the purpose, principles and objectives of broad-based black economic empowerment.
“We will be lodging a complaint with the BBBEE Commission and calling for an investigation, and that appropriate remedial measures be taken. We will also be notifying the Minister of Fisheries and Environmental Affairs of this violation of BBBEE principles and requesting that she authorizes her own investigation into this matter.
“We have every reason to believe the government, which awarded the long-term rights to I&J on the back of our involvement as an empowerment partner will take a very dim view of this revolving door approach to BBBEE. It goes against the spirit of everything that the policy was designed to achieve,” said Jack.
Main Street 198 is a broad-based consortium which represents the interests of a diverse group including orphans and widows.
‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’.