Negative equity BEE deals can be saved through appropriate rescue mechanisms

December 9, 2008

Many corporate BEE deals struck over the past few years would now find themselves 'underwater'

When the debt secured to acquire the equity interest exceeds the current value of the equity, as share prices on the JSE have plummeted in line with international markets.

Simon Venables (Pictured right), Corporate Finance Leader of PricewaterhouseCoopers SA, says it is important to highlight that these deals do not pose a subprime risk to the banks which have funded them.

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