Crimson Capital is a 100% black owned investment company with a Level 1 BBBEE status . 

We have partnered with Resonance Capital, a 1oo% black women owned investment holding and advisory company to advise and/or co-invest on certain transactions.

Based on management’s extensive experience gained and research conducted within the industrial, automotive and related components sector, in combination with numerous discussions and workshops held with various key stakeholders therein, Crimson Capital has identified the investment criteria and targeted sub-sectors below for its investment opportunities.

We have an existing investment portfolio that consists of a combination of direct equity investments and SPV structures that management are open to discussing in further detail under NDA due to confidentiality implications.

INVESTMENT CRITERIA

  • Equity interests in greenfield or existing manufacturers, including tier 1-3 automotive component manufacturers, related technology companies, and raw material suppliers in the value chain (this will include equity interests in project vehicles/SPVs setup to manufacture products for specific contracts).

  • Equity and strategic business partner to international component manufacturers looking to enter the Southern African market.

  • Equity interests in existing industrial companies including those that are seeking to move into the automotive components sector.

  • Effective shareholding interests from 25.1% upwards will be considered, with

    Crimson Capital seeking an active role in the strategy and management of its investee companies.

  • Where appropriate, Crimson Capital seeks to partner with Resonance Capital and/or key management within potential investee companies to form part of the investment consortium.

  • A combination of debt and equity funding (and/or government grants where applicable) would be sought for acquisitions and expansionary projects.

TARGETED AUTOMOTIVE SUB-SECTORS

The following items represent Crimson Capital’s targeted sub-sectors of focus within the automotive components industry, noting this is not meant to be an exhaustive list:

  • Auto trimming (including armrests, carpets, steering, seats, foam)

  • Hydrogen fuel cell and lithium ion technologies (and related charging infrastructure)

  • Plastic and rubber parts including injection moulding (interior and exterior trim/aesthetic components)

  • Polymers and other chemical additives

  • Pressed metal products and die-casting (including aluminium)

  • Raw material suppliers

  • Springs and Wheels (including alloys and related caps/covers)

  • Telematics/ Infotainment/ Electronic systems and related components

  • Tooling

  • Valve train components

  • Wiring (including wiring harnesses/components and wire welded frames)

OPPORTUNITIES FOR GROWTH WITH AN EMPOWERED SHAREHOLDER AND BUSINESS

Crimson Capital management has significant exposure to the automotive and industrial sectors (including in terms of advisory/analysis /funding) and view all investments as a long term investment commitment. It will seek to provide its corporate partners with strategic direction, knowledge and networks (including access to funding), and at the same time allow for an enhanced B-BBEE scoring of the Investee company thereby providing potential customers with enhanced procurement points.

 

In terms of the existing DTI incentive schemes, Crimson Capital seeks to focus on 2 key programmes which are relevant to industrial and automotive component manufacturers, which will assist investee companies with grant funding in order to achieve their growth initiatives, namely the Automotive Investment Scheme (AIS) Black Industrialists Scheme (BIS).

AIS

In terms of the revised Automotive Procurement and Development Programme (APDP), in order to continue qualifying for the non-taxable cash grant of 25% (cumulatively 35% if other requirements are met) under the AIS, automotive component manufacturers are required to be at a B-BBEE level 4 status (as a minimum) from 2021.

Crimson Capital, whilst playing an active role in new business development and evaluating expansion projects within investee companies, would provide empowerment credentials and input into meeting the applicable B-BBEE requirements and qualification for AIS.

BIS

The BIS offers a cost-sharing grant ranging from 30% to 50% to approved entities for capital/ expansionary projects that meet certain minimum requirements (to a maximum of R50 million). The size of the grant will depend on the level of black ownership and control, the economic benefit of the project and the project value.

The BIS offers support on a cost-sharing basis towards:

  • Capital investment costs

  • Feasibility studies towards a bankable business plan (to a maximum of 3% of projected investment costs)

  • Post-investment support (maximum of R500 000)

  • Business development services (maximum of R2 million)

As a Black Industrialist, Crimson Capital would seek to ensure compliance with and apply for BIS grants for capital expenditure/expansion.