The Black Business Manufacturing Fund (BBMF) 

• Processing of raw materials into inputs for finished goods,

• Conversion of raw materials into finished goods, and

• Adding value into semi-finished goods (including processing) for ultimate consumption by consumers of finished products

 Criteria:

• Majority owned by black people - minimum of 51% black ownership;

• Registered South African entities, (Pty Ltd), CC's or co-operatives;

• Registered for tax and in good standing with SARS, and have a valid tax clearance certificate;

• Involved in the manufacturing, processing, value chain

• Create jobs;

• Commercially viable, ability to repay the loan.

• Looking for funding for the acquisition of plant, equipment and machinery; improvement and upgrading of manufacturing processes; raw materials working capital; costs associated with delivering under export contracts;

• Looking for funding for the importation of plant and equipment (provided that the business can demonstrate that such plant and equipment cannot be sourced locally), and

• Looking for funding for the importation of raw materials provided such raw materials cannot be sourced locally 

Women Empowerment Fund (WEF)

The NEF Women Empowerment Fund funding to businesses owned by black women. R250 000 to R75 million across a range of sectors, for start-ups, expansions and equity acquisition purposes.

In order to provide for different transactional needs, WEF uses a range of funding instruments that range from secured (senior debt) to unsecured options (equity), and/or a hybrid of the two.

Pricing is commensurate with the risk taken and the instrument used.

Entrepreneurship Finance

 Providing start-up and expansion capital to new that are owned and managed by black people

Funding instruments include term loans, quasi equity and equity finance

Criteria:

·         BEE applicants should be actively involved in the day-to-day management of the business

·         Minimum black ownership of 50.1% is a requirement

·         Business and/or industry experience by black entrepreneurs is also considered

·         The NEF reserves the right to oblige applicants to participate in the NEF mentorship programme where there is lack of business and/or Industry experience

·         The business should be able to repay NEF’s investment

·         Funding Instruments include term-loans, shares and other structures with ordinary share characteristics

·         NEF funding is charged at prime linked interest rates

·         Business must have a clear value-add with a sound business case

·         Maximum NEF funding is R10 million

·         The NEF will exit from the investment in 5 to 7 years

Procurement Finance

Assisting black-owned SMEs that have been awarded tenders or contracts by public and private sector entities.

Funding instruments include terms loans, bridging finance, asset finance and revolving facilities

Criteria:

·         The term of the loan will match the duration of the contract.

·         NEF funding is generally limited to R10 million

·         There must be active participation by black individuals in the operations of the business

·         Minimum black ownership of 50.1% is required

·         Industry knowledge by management or there must be clear transfer of skills through relevant partnerships

·         Funding instruments include term-loans, bridging finance, asset finance, revolving facilities and debt finance

·         NEF will fund both the acquisition of assets and the working capital requirements of the business

·         NEF funding is charged at prime linked interest rates

·         The NEF reserves the right to oblige applicant to participate in the NEF mentorship programme

Franchise fund.

Criteria:

·         The NEF prefers to fund well established franchise concepts

·         Active management involvement by BEE parties is required

·         Minimum BEE shareholding of 50.1% is a requirement

·         NEF funding of franchises is through a loan instrument with the term matching the duration of the franchise license, however, up to a maximum term of 7 years

·         BEE party must have been pre-approved by the franchisor before approaching NEF

·         NEF funding generally limited to R10 million

·         NEF will fund SME; using mainly debt

·         NEF funding is charged at prime linked interest rates

·         The NEF will exit from the investment in 5 to 7 years

Acquisition Finance

 Criteria:

·         BEE applicants seeking to fund equity purchases of between R2 million and R75 million in existing businesses

·         Focus on medium to large companies

·         Focus on partnerships with existing management teams and other equity investors

·         Minimum BEE ownership of 25.1% post NEF investment

·         Active BEE management participation

·         Active BEE involvement in investee companies

·         BEE Financial contribution determined on case-by-case basis

·         Investment instruments can include a combination of debt, equity and mezzanine finance

·         The NEF reserves the right to oblige applicants to participate in the NEF mentorship programme

·         Typical investment horizon of 4 to 7 years

·         Security to include personal guarantee

New Venture Fund

This product provides capital of R5 million to R25 million per project for BEE parties seeking to participate in medium-sized greenfields projects with total funding requests of between R10 million and R200 million.

Criteria 

·         Minimum 25.1% BEE shareholding

·         Investment instruments can include a combination of debt, equity and mezzanine finance in support of BEE

·         BEE-specific financial contribution assessed on a case-by-case basis

·         NEF exposure to the project generally not to exceed 50% of total project costs

·         Proven management experience within consortium

·         Active BEE involvement in investee companies

 Debt funding raised from the market to match equity funding provided by NEF and other project sponsors

·         The NEF investment horizon is 5 to 10 years

·         Security to include personal guarantees

Liquidity & Warehousing

Assists BEE shareholders who need to sell a portion or all of their shares (as minority stakes in unlisted firms are hard to sell). Also acquires and temporarily warehouses these shares before on-selling them to new BEE shareholders, and refinances BEE shareholdings where existing financing structures are costly and/or inefficient.

Tourism Transformation Fund (TTF) Grant

Assist black-owned tourism enterprises to expand and grow, black owned youth, women and community owned tourism enterprises to take the tourism sector to new heights

Combination of grant funding, debt financing, and equity contributions to facilitate capital investment in the tourism sector by black entrepreneurs, where commercial viability of the tourism project has been proven.

Grant limited to 50% of the total funding approved and is capped at a maximum of R5 000 000 (Five Million Rand) per beneficiary.

Co-financing tourism transactions between the NEF and/or other accredited DFI’s is allowed under the Fund