Fund managers Prudential Shariah and venture capital asset management firm Futureneers, in a joint venture, have established Prudential Shariah 12J Investment Fund, South Africas first Shariah-compliant Section 12J Venture Capital Company
Mufti Ismail Desai, who serves on the fund’s board and investment committee, said, “I am excited to have been involved in developing and launching such an innovative investment product into the South African Muslim investor community.”
“The fundamentals in the fund’s design are solid; it is managed by an experienced team with an exceptional track record, and the investment mandate is well defined. I am confident that investors will find the value proposition an attractive consideration and alternative,” he added.
Treasury enacted Section 12J of the Income Tax Act, incentivises South African taxpayers to invest into the local economy, by means of a 100 per cent tax deduction on funds invested into a registered Section 12J Venture Capital Company. This equates to an immediate return of up to 45 per cent on the full investment amount, assuming the investor is on a 45 per cent income tax bracket.
The primary investment focus of the fund will be to invest in student, business and leisure hospitality properties. A secondary focus will be to invest in businesses that secure moveable assets and offer them to their B2B clientele on a rental basis.
The fund considers various types of moveable assets for investment, including but not limited to, office automation, telecommunications, information technology, security and medical equipment, and yellow metal such as graders and excavators.
Investments are considered together with the equipment suppliers or on a stand-alone basis and in combination with the Section 12J Tax benefit for investors.
