Sector charters will continue to add impetus to empowerment deals and are likely to result in a boom of empowerment transactions this year, analysts say.

More than R30bn worth of empowerment deals were concluded last year, and the figure could be surpassed this year as some charters have yet to be finalised.

These include the information communication and technology sector and the wine industry.

Empowerdex executive chairman Vuyo Jack says the fruits of deals arising from the charters are probably going to be seen this year.

"The mining and liquid-fuels charters began bearing fruit after their endorsement by both government and the private sector companies." Jack also says that, with this being an election year, the African National Congress-led government would want to be seen to be pushing harder for the empowerment of the previously disenfranchised black majority.

Ernst & Young director of corporate finance Ajay Lalu says the trend is likely to continue over the next three to five years.

Among the major deals likely to come to fruition this year is Absa's intention to sell 10% of the group's equity to black shareholders.

Touted as the biggest deal in the financial sector, such a stake is likely to cost R2,4bn.

Absa has a market capitalisation of R24bn .

The building and construction industry is another sector that could see a boom in empowerment transactions this year.

Construction companies such as Concor and Basil Read have shown their willingness to wrap up empowerment deals this year.

In its last annual report, Concor chairman Fritz Keller said his group was negotiating a black empowerment deal. He said the move was designed to preserve the group's ability to secure contracts from the mining sector .

Basil Read is looking to implement a strategy that could see 10% of the company owned by a black empowerment group within two years.

In the information communications and technology sector, Dimension Data has said it is in talks with an empowerment consortium and negotiations on financing are under way.

The company plans to sell up to 25% of its local arm to an empowerment partner.

This would be the second major deal in the information technology sector after Comparex sold 25,1% of the group to empowerment group Business Connexion for R225m.

Other companies that have announced that they are either looking for empowerment partners or are already in advanced talks include Iscor, Pepkor, McCarthy, Avis SA, KWV, African Life, Transpaco, Bytes Technology and Reunert.

But a lot of these deals will depend on the source and structure of funding.

BusinessMap director Reg Rumney says financiers who were heavily involved in funding empowerment deals lost a lot of money after the market crash of 1998.

"So there is some caution being taken by financiers this time around," he says.

Another challenge facing empowerment relates to finding new empowerment partners, instead of using the same faces .

Business Day