The sale of assets is an alternative indirect option to obtaining BEE Ownership. This statement allows a company to sell their operational assets, a business, or equity instrument in another business, to black people (or to an entity that is at least 51% Black Owned) as an alternative to selling an equity stake in the company.
The asset’s value is measured against the total value of the Seller and will determine the Ownership percentage score. For the first three years after the sale of assets, the Seller’s Ownership will be measured based on the value of the Seller and the value of the separately identifiable related business. After the three-year period, the value of the transaction in year three is then applied as the Ownership score indefinitely.
For the transaction to qualify as recognition as an ownership alternative it must meet the following criteria:
- Must result in the creation of a sustainable business or business opportunities in the hands of black people;
- It must also result in the transfer of critical and specialised skills or productive capacity to black people;
- A sale of an asset, Equity Instrument and business must involve a separately identifiable related business which has: no unreasonable limitations; clients, customers or suppliers to the seller; B-BBEE shareholders or their successors if the BEE shareholding is the same or improved, holding the asset for a minimum of three years.
- Any operational outsourcing arrangements between the Seller and Associated Enterprise must be negotiated at arms-length fairly and reasonably.
- The transaction is subject to independent verification value by an independent expert.
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