Jowell Tobias
Regional Office: Northern Cape
February 2014
IDC - Corporate profile
• Established:
October 1940
• Corporate type:
Development finance institution, mandated by Act
• Objectives:
Increased industrial capacity
• Activities:
Provide risk capital to viable businesses in various
sectors
• Regional mandate: South Africa & the rest of Africa (since 1998)
• Shareholding:
Government of South Africa = 100% shareholder
• Reporting:
SA Ministry of Economic Development
• Funding:
100% self-financing
• Governance:
Follows normal company policy and procedures
Partnerships, Professionalism & Passion
IDC Head Office, Sandton, SA
Role of IDC’s Regional Office
• Strategy for regional development
• Proactively identify and support investment opportunities
• Improve IDC’s efficiency & accessibility
Convenience (district visits)
Personal attention
Package applications to conform to IDC norms
Involve other stakeholders e.g. Landbank, NEF,
IDC Regional Office, Kimberley
DBSA, DoA, Water Affairs
• Business Support
• Represent all IDC sectors
Sectoral focus
Logistics
Green and
energy saving
industries
Bio fuels
Clothing, textiles,
footwear, leather
Mining related
technologies
Biotechnology
Cultural industries:
Craft and film
Business process
services
Automotives,
components, medium
and heavy
commercial vehicles
Advanced
manufacturing
Pharmaceuticals
Healthcare
ICT
Agroprocessing
Metals fabrication,
capital and
transport
equipment
Industrial
infrastructure
Forestry, paper &
pulp, furniture
Plastics and
chemicals
Tourism
Legend:
Mining
Downstream mineral
beneficiation
IPAP
New Growth
Path
4
Strategic Business Units
•
•
Agro Industries
Forestry and Wood Products
•
•
•
•
Metal, Transport and Machinery
Mining and Minerals Beneficiation
Textiles and Clothing
Chemicals and Allied Industries
• Tourism
• Media and Motion Pictures
• Information and Communications Technology
• Venture Capital
• Healthcare
• Green Industries
• Strategic High Impact Projects and Logistics
Special IDC Schemes
Gro-E
Scheme
• R10 billion available for 5 years
• Loans @ Prime - 3% for the first 5 years
• Equity @ 5% RATIRR
• Capital and interest payment holidays as
per financial needs of the business
• Minimum = R3 million & Maximum of R1
billion per project
• Business must have prospects of
acceptable profitability to service its
obligations
• Cost per job created should not exceed
R500 000
UIF Job Creation
Fund
Transformation and
Entrepreneurial Scheme (TES)
• R2 billion unsecured 5-year listed private
placement bond
• Women Entrepreneurial Fund (R400
million)
• Cost per job of up to 450,000 will be
eligible
• People with Disabilities Fund (R50 million)
• Pricing @ approximately 6.0% - 10.0%
fixed;
• Extent of discount is based on the risk
and developmental impact
• Development Fund (R250 million)
• Equity Contribution Fund (R150 million)
• Community Fund (R150 million)
• Maximum = R100m
• Only senior debt instruments
• Client is expected to drawdown within 7
months after approval
• B-BBEE certification from an accredited
verification agency is required
Distressed
Funding
• R6,1bn made available for companies negatively
affected by the recent international financial
crisis
Gro-E Youth scheme
• Earmarked R1 billion of the Gro-E scheme to businesses owned by young people
(age less than 35);
• Loans at prime less 3% to businesses;
• Industries falling within IDC’s mandate;
• Are creating new jobs;
• Available to South African citizens;
• Minimum amount for finance is R1 million;
• Experienced entrepreneurs to join with the youth in establishing businesses to
ensure that these new entrepreneurs are coached and mentored.
Gro-E Youth scheme (cont.)
Criteria and terms of the scheme:
• Start-up businesses;
• Existing businesses for expansionary purposes;
• Businesses that demonstrate economic merit;
• For the duration of the funding period;
• Maximum cost per job does not exceed R500 000;
• Broad-based Black Economic Empowerment certification, where applicable;
• Businesses operating or expanding in South Africa;
• Funding period will be structured to meet the cash flow needs of the business;
• Appropriate capital and interest payment holidays will be applied;
• There is no prescribed minimum for owner contribution;
• Shareholding by youth of more than 50%.
Business Support
• Technical assistance (TA) for IDC clients;
• Outsourced Consultants, Mentors, Coaches legal experts provide TA;
• Training courses delivered through IDC Learning & Development (External) Dept.;
• Training offered to investee members of the Board of Directors / Trustees,
Management Team, middle management, supervisors & staff destined for
promotion
• Funding principle: Cost sharing between IDC and Client
 The norm is: 50% Grant funding and 50% Client own contribution;
 Client own contribution: business cash flow OR a low interest or zero rated
loan.
Appraisal & approval process
Enquiry&
Application
Approval
Legal Agreements
Initial Screening
Basic Assessment
Due Diligence
Term Sheet
Disbursements
Post Investment
Management/
Business Support
Green Energy Efficiency Fund (GEEF)
• Programme supported by German Development Bank (KfW)
• To support and promote energy efficiency and renewable energy investments
• R500 million facility for energy efficiency and small scale renewable energy projects
Conditions:
• Financially viable energy efficiency projects
• Private sector companies registered and operating in South Africa
• Loans ranging from R1 million to R50 million
• At a concessionary rate of prime less 2%
• Repayments of up to 15 years, depending on the energy efficiency or renewable energy
technology
• Standard IDC fees, credit policies and procedures apply
• Loans available in ZAR
Thank you
Industrial Development Corporation
13 Bishops Avenue, Kimberley
PO Box 808, KImberley 8300
South Africa
Telephone (053) 807 1050
Facsimile (053) 832 7395
E-mail kimberley@idc.co.za