KZN fund for emerging businesses
Chris Khumalo
17 November 2004
Standard Bank and the provincial government have teamed up to establish a multi-million rand fund for small, medium and micro enterprises in KwaZulu-Natal.
Standard Bank, which has been awarded a three-year tender to manage the provincial government's R38-billion account, has teamed up with the province to raise R400-million to fund emerging businesses in KwaZulu-Natal over the next five years.
Standard Bank's appointment follows the KwaZulu-Natal cabinet's decision to issue a tender to banks to bid for the multi-billion rand account, which was held by Absa for the past six years.
"The expiry of the agreement with Absa in June provided the government with an opportunity to test the market with a view to finding out more benefits for the provincial government given the size of the account", said KZN Finance and Economic Development MEC Zweli Mkhize.
He said Standard Bank had proved to have strengths, including an innovative
approach, which featured a set of proposals based on a joint exploration of the commercial viability of several key growth projects in the province.
"These included investigating the establishment of a Provincial Growth Fund, which incorporates a significant portion that will be used to fund infrastructure development."
Mkhize also said that the government would contribute equity and mezzanine funding of R440-million, while the bank will commit R400-million towards debt funding.
"Together, the partners will raise additional funding of R260-million", Mkhize said. "It is envisaged that the Growth Fund will have a capacity to invest R1.1-billion in viable development projects in the province."
Source: BuaNews
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