Property services leader JHI Real Estate and empowerment investors Mpande Holdings and Phatsima Industrial have signed a landmark empowerment deal that focuses strongly on participatory shareholdings in the booming property sector.

Says JHI executive chairman Les Weil: "JHI was against the idea of passive shareholders; we wanted investors with a genuine business interest in property."

Weil says that after doing careful research into potential investors, JHI decided to sound out Phatsima and Mpande individually before initiating joint discussions.

The deal was signed by all parties this week.

The structure of the deal is crafted to ensure maximum, broad-based empowerment equity. "We are all keenly conscious of the deal’s value proposition," says Weil.

Together, Mpande and Phatsima have taken a 35% stake in JHI in equal shareholdings. The intention is that Mpande, Phatsima and JHI will identify additional empowerment shareholders, which will result in an empowerment shareholding in excess of 40% inclusive of JHI's empowerment executives.

A strategic decision to enter the property market led Mpande into negotiations with JHI.

"Mpande focuses on a few industry sectors in which its directors have deep experience and knowledge – and property is one of those focus areas," explains Mpande chairman Humphrey Khoza.

Mpande’s investment philosophy fitted nicely with JHI’s goal of finding participatory stakeholders, explains Weil.

Khoza adds that Mpande is a group of highly experienced business people who are black, not a group of black people that want to get into business to exploit the BEE environment.

Phatsima Industrial is an investment company with broad-based empowerment equity. Shareholders include the African Equity Corporation and Morongwa, a community women’s group.

Phatsima chairman is well-known businessman and Black Like Me founder Herman Mashaba, who last week won the coveted Black Management Forum (BMF) Presidential Award for business excellence.

Mashaba, too, underscores Phatsima’s strategic decision to enter the property services sector - especially given the prevailing boom in property country-wide.

"We have a strong operational interest in property services. Joining up with an established name like JHI made a great deal more sense than trying to start a new brand," he elaborates.

Khoza along with Mashaba will join the JHI board.   In addition, Phatsima will also be represented by the well-known businesswoman and chartered accountant Thebi Moja.

Thebe Investment Corporation who have held a 34% stake in JHI since 1996, decided last year to divest of its stake in JHI.   They have been able to do this, which left the way clear for JHI to find another partner.

The next step for the new investment partners, says Weil, is a long-term strategic planning session to pinpoint specific areas of operational interest for the new shareholders and define direct involvement to compliment the executive function.   The intention is to broaden the property knowledge of the new investment parties and their associates utilising the established methodology of JHI's successful Craft program, which has been in operation since 1994 and has produced a number of black property practitioners for the market.

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Les Weil, JHI Real Estate Chairman:  083 461 3777 or (011) 441 0100 (office)