South Africa’s only manufacturer of satellite systems, and one of only two in Africa, Sun Space & Information Systems, has concluded a R50-million deal to finance an ambitious growth and development phase with the National Empowerment Fund.
The company, which developed out of the SUNSAT programme at the University of Stellenbosch, manufactures high-value small- and medium-sized satellite systems for the local and international aerospace market.
The deal, which is in line with the NEF’s mandate of fostering and supporting broad-based black economic empowerment (BB-BBE), is one of a series of recent investments aimed at rapidly increasing black participation in strategic industries and enterprises.
NEF chief financial officer Andrew Wright, comments: “The attraction for the NEF in supporting this black empowered business arose out of especially the strategic sector in which it resides, namely the Space sector, and the fact that it is supportive of the DTI's space programme which is being implemented as a result of the National Space Policy. The NEF aligns its investment activity to the Industrial Policy framework plans of the dti and this is one such example.
"Further to this, in line with the specific mandate of the NEF, Sun Space already has an active black empowerment ownership and management element and the NEF funding allowed an opportunity to structure a more efficient capitalisation structure for the black shareholders and for the company itself.
: “Our current key strategic aims as the NEF, which are also in line again with those of government, also include the need to create new industrial capacity in our transactions and not merely ownership transformation in isolation thereof.
"Sun Space is poised on receiving and delivering upon key government contracts, adding to their existing specialist design, technical and manufacturing capacity, plus Sun Space are training and developing Black aeronautical engineers, contributing also to government’s aim to develop skills and human resources. This really has materialised into a win-win result for broad-based BEE."
Nonfuneko Majaja, chief director of the Department of Trade & Industry (DTI), adds: "Real empowerment is multi-faceted,” says (dti), “and has to be built on a range of initiatives focused on different objectives.
“Having started out by financing black-owned small and medium enterprises, and by supporting some of the country’s largest and most innovative empowerment share schemes, the NEF is now extending its focus to include promoting ownership of and executive participation in strategic industries.”
SunSpace, which operates from Stellenbosch, provides accessible, affordable, valuable and unique solutions to meet unique needs. Staffed by 57 people, including the team that designed the first locally-developed SUNSAT satellite to be launched by NASA in 1999, the company designs and develops high-performance satellites and payloads, as well as related subsystems, support equipment and ground applications.
The new deal, which will see the NEF investing directly into the BEE consortium that owns 25% of the company’s equity, is aimed at increasing capacity and improving competitiveness in the rapidly-developing aerospace market.
“Space technology is no longer the exclusive preserve of the developed economies of the north.” says Majaja. “South Africa is taking up its rightful place in this and other advanced technology industries, and is proving to be an innovative and energetic player. SunSpace, in particular, aspires to be a role model for empowering and developing people from all backgrounds in the fields of science and technology.”
The company specifically aims to benefit from the skills and knowledge capital of the growing pool of black professionals in the country by transforming ownership, management and the workforce. This enjoys top priority, together with other key business objectives, and has the enthusiastic support of both directors and shareholders.
“The NEF is proud to be involved in such an extraordinary venture,” says Majaja. And, as we celebrate the 40th anniversary of the historic moon landing, we know this is a giant leap for South Africa.”