Destinata Capital2019-01-24T11:11:52+00:00

DESTINATA CAPITAL LIMITED

I want to invest less than R1M & claim a 100% tax deduction

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I want to invest  R1M or more & claim a 100% tax deduction

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I seek funding for my business

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Destinata Capital - Section 12J Investments | Destinata Holdings

Destinata Capital is a registered Venture Capital Company in terms of Section 12J of the Income Tax Act 58 of 1962, and licensed in terms of Section 7 of the Financial Advisory and Intermediary Services Act.

Our goals are to offer investors a tax efficient investment vehicle – an investment in a 12J fund is 100% tax deductible – and to channel these pre-tax funds into companies where value can be unlocked and solid profit streams can be maintained.

Investors: You can invest R1 000 000 or more in terms of our Private Placement at R95 per Class A Ordinary Share, or less than R1 000 000 (minimum R100 000) in terms of our Public Prospectus at R100 per Class A Ordinary Share with window period 1 December 2017 to 28 February 2018.

Section 12J Calculator

Destinata Capital Limited
(Registration number 2017/340362/06)

FSP number:        48729
VCC number:       VCC-0073

Unit B1, Block 7
Fairways Office Park
5 Niblick Way
Somerset West
7129

How does a section 12J tax deduction work?

An investor qualifies for a deduction equal to the amount invested in a 12J VCC, duly registered with the FSB and SARS, in the tax period the investment is made.  The effective saving for the taxpayer is therefore the amount of the investment multiplied by his or her marginal tax rate.

When do I need to make the investment?

In the tax period you wish to claim the deduction in, e.g. if your financial year end is 28 February 2018, you need to make the investment, and have the cash paid over, on or before 28 February 2018.

Can I reinvest dividends, and will such an additional investment also quality for the deduction?

Yes.

What differentiates Destinata from other VCC’s?

Destinata Capital is a public company and intends to issue a public prospectus in line with the Companies Act 71 of 2008, which allows the investor to make a minimum investment below the R1m threshold that is applicable to VCC’s that have not issued a prospectus, opening the investment opportunity up to a much larger investor base.

Can I view my tax savings as part of my return on investment?

Yes, you can.  See the following example:

Mr A falls within the 45% tax bracket.  In year 1 he invests R1 000 000 in a VCC.  In that same year he receives a dividend of R200 000, which he reinvests.  The total effect for Mr A is as follows:

 Own cash invested: R1 000 000
 Tax saving:  R540 000  [(1 000 000 + 200 000) * 45%]
 Actual cost, after tax deduction effect:  R460 000  [1 000 000 – 540 000]
 Value received (investment + dividend):  R1 200 000  [1 000 000 + 200 000]
 Return on Investment [ROI] (Year 1):  161%  [(1 200 000 – 460 000) / 460 000]

Therefore, the effective ROI achieved is substantially better than the 20% dividend received.

In subsequent years, should a 20% dividend still apply, assuming no growth in the value of the investment, the effective ROI will be: 43% [200 000 / 460 000]

Are recoupments applicable? 

By claiming the 12J 100% tax deduction upon making the investment, the tax value or base cost of the investment becomes R0.  If the investment is sold within 5 years then a recoupment will be applicable.  If held on to for more than 5 years, when sold, only capital gains tax will be applicable.

CURRENT INVESTMENTS

DC Go Leasing

Funds deployed: 13% of fund capital

Investment into Solar Energy equipment with a 10 year energy off-take agreement in place.

IRR: 15% (Actual)

Secure Rite

Funds deployed: 15% of fund capital

Security & Armed Response.

IRR: 30% (Actual)

Destinata BNB

Funds deployed: 23%

Hospitality

Return: 11% – 13% (Estimated, pre-gearing & capital growth)
Return: 19% – 21% (Estimated, includes capital growth)

While we intend to source the majority of investments through our own networks, entrepreneurs seeking capital are invited to apply for funding.

THE STEPS FOR THE INVESTMENT PROCESS ARE:

1) APPLY ONLINE
2) REVIEW
  • We will review the application and possibly request further information.
  • If the application passes this phase we will arrange for a meeting with a representative from our investment committee.
3) INVESTMENT SCREENING MEETING
  • Should the meeting be successful, we will contact you to schedule a presentation (normally 45 minutes) to the full investment committee.
4) DUE DILIGENCE
  • Should the presentation be successful, a due diligence will be performed.  The due diligence exercise will be for the applicant’s account, unless agreed otherwise beforehand.
  • The fee for the due diligence process will be quoted upfront.
5) TERMS AND AGREEMENTS
  • Should due diligence be successful, we will negotiate the terms of the investment and enter into the relevant agreements.
  • We will normally buy equity in the company, but loan-equity combined investments remain an option.
  • We will normally insist on having a seat on the board and to have access to monthly management reports.
6) POST-DEAL INVOLVEMENT
  • While we prefer the entrepreneur, who is knowledgeable in his business sector, to remain in control of operational management, we like to remain involved on a strategic level in order to:
  • Install and maintain good corporate governance
  • Monitor our investment
  • Unlock value through management assistance
  • Providing access to our professional and finance network

PRIORITY SECTORS FOR INVESTMENTS:

While we do not exclude any sectors from potential investments we would target, we have identified the following sectors as priority:

  • Private security (this will have synergy with current operations of the Destination Group, who has access to a large database of townhouse complex investors, and therefore to body corporates)
  • Hospitality / hotel keep (attractive as it is backed by immovable property)
  • Private education
  • Manufacturing
  • Renewable energy

WHAT WE CANNOT INVEST IN:

Also take note that we cannot, by law, invest in the following types of businesses:

  • Immovable property (hotel keep / hospitality is allowed)
  • Banking
  • Long and Short term insurance
  • Money lending
  • Hire-purchase funding
  • Financial or advisory services
  • Legal services
  • Stock broking services
  • Management consulting services
  • Tax advisory services
  • Auditing or accounting services
  • Gambling
  • Liquor
  • Tobacco
  • Arms or ammunition
  • Trade carried on mainly outside South Africa

We have identified the following as potential investment opportunities and are currently in contact with management.

1. DC Go – click here for the brochure

2. Destinata Student Accomodation – click here for the brochure

3. Nortelec – click here for the brochure

Account name: Destinata Capital Limited
Bank: ABSA Bank Limited
Account number: 40 9324 5875
Branch: 632 005

Please note that the Investment application form (whether in terms of the Private Placement Memorandum [under R1m] or the Public Prospectus [R1m and over] must be submitted and full compliance requirements [supporting documents] adhered to before share certificates and 12J certificates will be issued.

Johannes Maree Jpeg Reinhardt Pieter Reinhardt
Johannes Maree CA (SA)
CEO
Executive Director
Reinhardt Steyn
Non-Executive Director
Pieter Reinhardt
Non-Executive Director

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