Ghost Stories #38: Chasing Returns from the Sun

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Tivon Loubser is all about chasing the sun – and generating investment returns from solar projects. Thanks to South Africa’s ongoing need for renewable energy projects of every size, there are tax benefits available to investors for doing this. We unpack the opportunity in this podcast.

The podcast is brought to you by Twelve B Fund Managers, a private equity fund entitling tax payers to invest in a portfolio of renewable energy generating assets and benefit from the recently gazetted 125% 12BA wear and tear allowance. After successfully closing Fund I, and deploying all the raised capital in the previous financial year, Twelve B Fund II is open for investment. The fund will close at the earlier of R100m or 30 June 2024.

Please do your own research, discuss this with your independent financial advisor, and if you would like to set up a meeting with the Twelve B team, or would like more information, visit the Twelve B or Grovest websites.

Twelve B Fund Managers (Pty) Ltd is an approved juristic representative of Volantis Capital Proprietary Limited, an Authorised Financial Services Provider FSP No 49836.

Full transcript:

Intro: This podcast is brought to you by Twelve B fund managers, a private equity fund entitling taxpayers to invest in a portfolio of renewable energy generating assets and benefit from the recently gazetted 125% twelve BA wear and tear allowance. After successfully closing Fund One and deploying all the raised capital in the previous financial year, Twelve B Fund Two is open for investment. The fund will close at the earlier of R100 million or the 30 June 2024.

The Finance Ghost: Welcome to this episode of the Ghost Stories podcast. It’s going to be an interesting one. Today we are talking about the sun; chasing the sun. Not the Springbok variety, but rather some solar panels. And who better to do it with than with Tivon Loubser, who is a fund manager at Grovest, specifically focusing on the Twelve B side of things. So Grovest is a name that is familiar to Ghost Mail readers and podcast listeners. Chances are that you’ve heard it before. Tivon, welcome to the show. I’m really looking forward to chatting to you about this stuff and I think let’s kick it off with maybe just a two-minute overview of Grovest and your role there. Just for those who aren’t necessarily familiar with the group and what you guys get up to.

Tivon Loubser: Thanks so much for having me on, Ghost, really appreciate it. So as you mentioned, I’m the fund manager for Twelve B Green Energy Fund. It is a product which has been pioneered by Grovest, the largest small cap fund administrator in the country. We accumulated a lot of that under the section 12J universe and are now expanding into the Section Twelve B universe.

The Finance Ghost: Fantastic. And so you focus on the Twelve B side, which means you spend a lot of time doing solar projects. It’s pretty much just solar, right? There’s no other renewables in there or is there other stuff as well?

Tivon Loubser: No, our investment mandate is pretty narrow towards solar investments. It’s pretty much because we know it, we’ve been involved with it. We got involved through section 12J. So we really understand the fundamentals, all the assumptions and the underlying to solar. So while you can expand into other renewables through section twelve BA, we’ve taken a focus on solar installations.

The Finance Ghost: Yeah, look, on a personal note, it’s always nice to see people focusing on what they are good at and understand. I think that’s probably a sound strategy. I don’t know a huge amount about renewables, but I do know that wind is a bit more variable than sun. Unless you live in Milnerton, where I do, in which case you can bank on both being there pretty much all the time. So, speaking of things that just magically disappear or come and go – load shedding, I don’t know what happened to it, but I’m certain it’s going to come back after the elections. It’s not like that’s been magically solved, let’s be honest. And obviously for you guys, it’s kind of a catch 22, because when that Eskom se Push notification arrives on your phone, you probably go, ah, fantastic demand for solar it is here. So I guess you have a kind of an odd relationship with load shedding. But before we get into some of the projects you guys have done and everything else, I think we can all agree that load shedding can’t have just been magically solved overnight. So I think there’s a good chance that this is more politics than anything else. And I guess with that in mind, why do you believe that supporting investment in solar is such a good thing to be doing in South Africa?

Tivon Loubser: Well, I think you share similar sentiments to Julius Malema, who said, we’ll probably be on stage six, midnight, 29 May.

The Finance Ghost: Look, I don’t have a helluva lot of things in common with Julius Malema, but I think on that one, I’ll take it.

Tivon Loubser: You’d be naive to think load shedding is a thing of the past. I think it’s definitely a bit of a political ploy, or very much so, a political ploy. And, you know, I pride myself on trying to find the silver linings. And with load shedding, I think it’s been quite challenging. You know, it has an immense drag on our economy. It hampers our day to day lives. And I think it’s been the source of 90% of South Africa’s frustrations in the past couple of years.

What I would say and where I take the silver lining is that it’s definitely in a roundabout way aided South Africa’s transition to a carbon neutral future, or at least a low carbon economy. And interestingly, I was listening to a Blackrock webinar recently where they were talking about key mega forces and where they see the investment landscape playing out. Obviously the classics like AI came up and geopolitical instability, but their major focus was on the transition to carbon neutrality and a low carbon economy. And I think we’ve seen that in South Africa. So these stats might be outdated, but I believe we’ve got eight gigawatts installed capacity in South Africa. It counts for more than half of Africa’s installed capacity and three gigawatts of that came online last year. So it’s definitely been or aided South Africa’s transition to a low carbon environment. And then we have to give some kudos to treasury for coming out with these incentives and obviously to South Africans for being resilient and for being innovative in their approach.

The Finance Ghost: I mean, there’s the feel-good factor. It’s obviously slightly funny to hear Blackrock talking about a coal transition, for obvious reasons based on their name, but there’s clearly the carbon story. There’s also a cost story, which I think is something that’s becoming more and more prevalent. Eskom’s increases are substantial and to my knowledge, and you can confirm this, the cost of solar panels, et cetera, has come down over the years. So I guess at some point you reach parity, right? As the technology improves, as Eskom becomes an increasingly inefficient, ugly thing, at some point solar becomes just a spreadsheet decision, more than a feel good carbon decision. You know, that stuff almost becomes the bonus, which unfortunately, I think for a lot of people is the reality. Most people will make the numbers decision first and if they can feel good about it, that’s a bonus.

Tivon Loubser: No, 100%. I mean, we’re seeing solar panel costs coming down drastically. And as Eskom’s customer base dwindles, as the mines shift to renewable energy sources, they’re going to have to pump up those prices drastically. If we look globally, our energy costs are relatively low. So Eskom and NERSA don’t have that ceiling or that upward pressure where they say we can’t increase the prices anymore because if you look to Italy, you’re probably paying 18 rand per kilowatt hour. So Eskom aren’t experiencing that upside pressure yet. Their supply base is dwindling and they obviously need a lot of money for repairs and maintenance. So if we are installing just a PV system, so not a hybrid system with battery, we can significantly undercut the Eskom rate. Obviously once you start incorporating battery storage and hybrid inverters, et cetera, et cetera, it does push the price up. But we generally seeing a four year break even because we escalating at CPI plus one. Whereas NERSA one year 15, one year 18, then twelve. But I’m sure it will always be double digit numbers going forward.

The Finance Ghost: Yeah, I think you’re right. I can’t see a world in which they’re not doing double digit increases. So the case for solar is strong in South Africa. Our sun also shines a lot, obviously and so that gives further support to what you guys are doing. So speaking of what you are doing, I think let’s talk a little bit about this Twelve B fund. This is Twelve B fund two, which implies that there’s a fund one obviously. So I think let’s start there. Let’s talk about fund one and how that’s been going when it was launched, how many projects you’ve done, what sort of properties – open the floor to you to actually talk about what you’ve done in fund one and Grovest’s track record in the space?

Tivon Loubser: So we launched fund one on the 14th of Feb last year. We were the pioneers in the section Twelve B space. We were the first Twelve B fund to market. We actually went to market before they announced the 12BA allowance which is the enhanced 12B 125% as opposed to 100%. And so we raised money. We closed our raise at the end of November last year and maybe this is a good time to bring in one of the caveats to 12BA and that is that all the money that is raised has to be deployed into renewable energy generating assets. So that’s been our big focus. We had to make sure that all the money we raised was deployed and the projects came online in the last year. We’re very proud that we did get that across the line. So we deployed capital into eleven different projects with a nice geographic spread, nice sector spread. We actually took a stance where we quite like dealing with body corporates. So high LSM sectional title units and the reason we took that stance, and it was quite a contrarian stance, lots of people didn’t like dealing with them, they would focus more on your commercial and industrial projects. We found it mitigated key-man risk. Firstly, you know, if you’re dealing with a commercial industrial project with one business owner and something happens to happen to them and they don’t have a solid contingency plan in place, you know, that is a big risk. And then you’re also spreading your collections risk. So instead of collecting from one business owner you’ve got a high LSM group of 30 to 60 units. So we really took a stance where we like dealing with the body corporates of the world. Not to say that we didn’t deploy into commercial and industrial projects. And I think it’s another nice thing with this investment is that it’s a very tangible investment. So our investors in Fund One can say that they’ve contributed to moving ten different installations, you know, moving their reliance from Eskom and onto a more renewable energy source. And a very nice anecdotal story. I actually did a site visit last week to one of our printing factories in the northern suburbs of Johannesburg. And just listening to the business owner talking about how he’s reduced his work days from six to five, how he’s reduced his lost production events, I mean, it really is brilliant to hear. And, yeah, again, I really think that’s the beauty of the product, is if you invest R100,000, you can say you’ve acquired R100,000 worth of solar panels which are generating energy for either business or for body corporates.

The Finance Ghost: Yeah. Literally keeping the lights on in the economy. I mean, that’s what this stuff is doing. I think the focus on body corporates is kind of cool and makes a lot of sense, because obviously, part of the problem with solar is for people who live in apartments, you can’t just decide yourself to go and do solar, set up your rig on your balcony and hope for the best. It kind of needs a body corporate led decision. And a lot of these apartment blocks and those sort of places do have a nice big roof, obviously, especially big, tall apartment blocks. You can imagine the size there. So it’s quite nice to see you operating in that space, because it creates a solar opportunity for people who otherwise would definitely not be able to do it. It’s not like having your own standalone house with your roof, where you make the decision 100%. So I think let’s move on to some of the numbers, which is obviously why Grovest ultimately has a business here, is because people can invest in the fund, and in turn, you go and put in place solar projects and attract a stream of cash flows, like any great investment. So with those solar assets now done in Fund One, and several projects out there in the wild, would you say that they are performing in line with your original investment expectations? So, in terms of what was said to investors at the time the money was raised.

Tivon Loubser: Yeah. So what I mean, the other beauty of this product is it’s backed by contractual cash flows. So the underlying mechanism is that we enter into what are called power purchase agreements with these off-takers, and in these power purchase agreements, they’ll stipulate a tariff. So let’s say R1.40, they’ll stipulate a fixed cost. If there’s a battery component and that’s a fixed monthly cost, they’ll stipulate an escalation, which, as I’ve mentioned, we peg it to CPI plus one, or one and a half. So it’s also a nice real money investment and protects your money against inflation. There aren’t these variabilities or they aren’t these huge assumptions like you would see in venture capital. It’s all fairly easy to model the returns. You also have downside caps on consumption. So you have minimum offtake guarantees where in your PPA you’ll say you have to consume 85%. If you don’t, you’ll still be charged for 85%. That’s just to protect the downside. So we are seeing, we’re tracking nicely to our modelled returns. What’s quite interesting, especially with body corporates, is that you see in summer months, their consumption is about 50% of what it is in winter months. So you actually have to track it with that sort of distribution in mind. And that’s what we have been doing to date. The projects have, or the majority of the projects have probably been in the money now for, I would say probably four months. So we’re still tracking nicely to returns. It’ll be nice to see what happens in winter and what the consumption looks like there. We’re still tracking to our an average of 14% return or cash yield and 18% IRR.

The Finance Ghost: Yeah, so let’s talk about the IRR versus cash yield quickly, just because it’s a good place to do it. So of the returns, basically there’s a cash flow stream over the years. Are there any assumptions towards the back end of the period about what happens to the stuff or any kind of exit for you guys? Because that’s where the forecast can obviously get a bit more difficult. I can certainly believe that just forecasting the actual earnings from selling electricity. Eskom may struggle to sell electricity efficiently, but I can understand that you can get that right with a solar project. So where is the forecasting risk? Is there something going on at the back end and after how many years?

Tivon Loubser: Yeah, so very interesting question. This investment operates a lot like a fixed income instrument. So we’ve got biannual cash distributions. That’s where you’re hitting that 14% average yield. It does ramp up over time. So initially we’re probably looking at about 10.2% scaling up over the years. The investment term is ten years. However, a number of the underlying cash flows are pegged to 20 year power purchase agreements, which seems to be the industry norm. We are diversifying our paper a bit, so we’ll have some 20 years, some 15/10/7.5, just to spread our cash flows and our returns quite nicely. So the question is, how do we exit this investment? What we do is we model to sell the underlying paper to a third party, whether it be another finance house or another EPC, and we model it. What we do is essentially a discounted cash flows from year 20 to the end of year 10, and we use a 13.5% discount. Now, that might sound very wishy washy, and, you know, how do you actually come up with those figures, and where does it all come from? So it’s quite common practice in finance to sell paper at a discount, because the off-taker or the purchaser would be buying cash, buying money at a discount. Interestingly enough, it happened with fibre. So initially there were a bunch of microfibre installers, and then there was a Remgro company, if I’m not mistaken, called Dark Fibre Africa, and they came along and accumulated all the paper. And you’re essentially buying into these cash books at a discount. So I mentioned we discount the cash flows at 13.5%. I also mentioned earlier that we’ve been involved in solar for a long time, so we’ve exited two R200 million rand solar portfolios on the same basis, and we ended up selling them off at about a 12.2% discount. So we think 13.5% is a fair assumption. We also have the discretion, you know, if market conditions are really favorable at year eight, if we get an offer at a 12% discount, we are never going to turn that away if we’ve modelled it at a 13.5% discount. So we can use our discretion, you know, analyzing macro factors, analyzing the economy, we will come maybe exit early, maybe exit one year later. But, yeah, that’s the exit mechanism. So much like a fixed income instrument, biannual cash distributions, and then a large capital windfall in year ten.

The Finance Ghost: You can almost think of this as a different way of investing in property. Actually, it’s kind of a reasonably similar way of thinking. CPI linked, there’s a cash flow yield, there’s a CPI protection to it.

Tivon Loubser: Exactly.

The Finance Ghost: So the difference here being that you have a tenant, effectively for 20 years, unless something drastically goes wrong.

Tivon Loubser: So, I mean, while it’s marketed as a private equity investment, it actually mimics very much so private infrastructure, and it’s also highly collateralized, which is really nice. As I mentioned earlier, you invest R100,000, you own R100,000’s worth of the underlying and worst case scenario, if the offtaker does default, we’ve done loss-given default analysis, and we’re able to uplift 70% to 75% of the underlying equipment. So while that’s a worst case scenario, it’s not the worst, worst case scenario, if that makes sense.

The Finance Ghost: And I’m sure the stuff is all fully insured. If there’s any kind of geological event or fire or anything like that, I mean, your asset is protected.

Tivon Loubser: Yeah, we have all-risks insurance on our hardware and then we also have business interruption insurance for four months. And I think ensuring solar panels at the moment is quite an ordeal because insurers are turning around and they’re seeing fires breaking out at solar plants. So they’re becoming more stringent with their requirements. So we vet all our EPCs that we deal with very closely, engineering, procurement and construction companies. The installers make sure they have their PV green cards in place, make sure they’re part of some industry standard, that they’ve got wireman’s licenses, because that’s really what you have to do. You have to make sure that the installer is doing a really good job and that they’re ticking all the boxes, you know, CoC, etcetera. And then also the equipment we use, tier one equipment, they all come with lengthy warranties. And tier one suppliers are a list of suppliers that Bloomberg have posted. And it essentially just means that they will be around in the future to, you know, to fulfill those warranties.

The Finance Ghost: So in terms of biggest learnings from fund one, I mean, it is always so important when someone has track record rather than just hopes and dreams. I guess there were probably some positive surprises, negative surprises. Anything that really stands out for you versus expectations?

Tivon Loubser: No, definitely. I think, you know, the nature of being pioneers is it’s often a steep learning curve and you often have a number of learnings along the way. With Fund One, we have a strategic alliance with an installer, Hooray Power. And we dealt pretty much solely with them. You know, the benefit of that was we had extensive deal pipeline, I mean, in excess of R300 million. The only issue is when you’re sticking to one EPC, you do hinder your deployment capabilities. So while you have this immense deal pipeline, obviously doing the installations takes more time. So what we’ve done for Fund Two is we really casting our net wider. We’ve got numerous business development personnel who are sourcing deals. We’ve got relationships and agreements in place with various installers across the country, all who are very reputable. We are dealing with intermediaries, so we really casting our net wider so that we can deploy even more. And that means we can raise even more, because again, we’re very cognizant of the relationship between raising and deployment. We can only raise as much as we can deploy. So we aren’t hindered on the raising side, you hindered on the deployment side. And ultimately, because 12BA is going to be sunset on 28^th February, 2025, we want to get this tax benefit to as many investors as possible.

The Finance Ghost: Now that makes sense. You can always find the money, right? Finding the hard assets is actually the difficult part at the end of the day. So let’s talk about this fund too, and the tax and the sunset clause and all this kind of thing. How exactly does the tax actually work here? And I have seen lots of stuff around rules for when the projects become energy producing. I think maybe let’s spend a couple of minutes just on how this tax actually works. And then what difference does it make to the returns? There’s a tax enhanced return, and then there’s the return that the assets would give without the tax benefit. So I think running through that will be very helpful.

Tivon Loubser: I’ll start from the beginning. So section 12B has been around since 2016. What section 12 B said is that you’d be able to reduce your investment into renewable energy generating assets by 100%. Now, 12B had some caps, so it was capped at 1 Megawatt. Then last year in Feb, Treasury announced section 12BA. Section 12BA is the enhanced 12B, so you’re getting 125% as opposed to 100%. There’s also no more cap on it, so it can be in excess of 1 Megawatt. They’re really trying to stimulate this transition, I think, and also reduce the reliance on Eskom. There are a number of caveats to 12BA which weren’t present with 12B. The most important is that it needs to be new and unused and brought into use for the first time. So you can’t invest into existing projects. I can’t go and put money into an existing solar plant and get the 125% allowance. I would only be able to claim the 100% allowance. The other thing with 12BA is that you can only claim it once that money has been deployed into energy generating assets. So it’s no good we go buy R100,000’s worth of solar panels and keep them in our warehouse and just sit on them. That doesn’t qualify for the 12BA allowance. It is very important to understand that the money has to be deployed and the assets need to be generating energy. So you either need a CoC, you need an invoice for energy generated, or you have to reach beneficial use. Those are very important components and that’s why we always really urge potential investors to do your due diligence, make sure wherever you’re placing your money, they’ve got sufficient deal capacity and that they are able to deploy all this capital. Moving on to your other point about obviously the 12BA allowance is brilliant. You know, extremely lucrative. People are always looking to minimize their tax allowance. So the tax allowance I think is great for marketing, it’s brilliant for our investors and I think it’s a big reason why investors are so keen on this product.

But what I really like about this product and why I’m so passionate about it is it actually stands on its own without the 12BA allowance as well. So we’re looking at a project level return. So without the 12BA allowance of anywhere from 15% to 16%. So 15% to 16% at the project level, excluding the 12BA tax allowance, obviously the 12BA tax allowance bolsters it to around an 18% IRR. And I think the other area we’ve poised ourselves very well at Grovest is while we have it in our investment mandates to gear so we can bring in debt into the portfolio, we haven’t done it as of yet. And what that’s done for us is it’s made us push for higher returns at the project level because we can’t use gearing as a crutch, we can’t hit 12% or 11% at the project level and then bolster it up drastically with gearing. So we are really pushing hard for high returns at the project level. And then in the future, once we’ve developed a strong cash flow book, we can go acquire financing, we can gear up the projects even further and just use that geared amount to bolster the returns even further and bolster the tax benefits. So I think that’s where we really stand in good stead here.

The Finance Ghost: Let’s just talk about distributions along the way, especially with a ten year investment term, which is quite long. I mean, you’ve talked to the stream of cash flows, we’ve compared it to fixed income style instruments and property and all these kind of things. So what do these distributions look like along the way? And then how are they taxed? Are they taxed as dividends or do they come out as normal income?

Tivon Loubser: Yeah, so interesting question. So the investment vehicle is an en commandite partnership. The reason we’ve done that is, and another caveat to claim the 12BA allowance is that you have to be deemed to be carrying on trade because the general partner, which would be the 12B GP, is deemed to be carrying on trade, selling energy, all the LP’s, which would be the investors, are deemed to be carrying on trade.

What that means in terms of tax is that the distributions, they aren’t dividends. Distributions are taxed in their individual capacity, so it’s a complete flow through principle. An en commandite partnership isn’t a taxed entity, so all the tax will be dealt with in one’s individual capacity. We pay out biannual cash distributions. So it’s a high cash yielding investment. And what’s nice about that is that it’s a very liquid fund. And when we talk about private equity, we talk about illiquidity premiums, etcetera, etcetera. And as you mentioned, a ten year investment horizon is a long term investment. I think the average lifespan of an investment in South Africa is 7.5 years. And people are skeptical on the outlook of South Africa. But what we do is we do say we can create liquidity events. We’ve got high cash yielding underlying or underpinning assets. And obviously, given liquidity constraints and given a proper analysis, we can buy back partnership interests. Obviously that will be at a discount, which is determined given the market conditions. But we do always advise staying in until maturity. You really are getting a large windfall in year ten, and I think the risk profile of this investment warrants that ten year investment horizon.

The Finance Ghost: In terms of that windfall in year ten, that would then be a capital gain at the end of the period. Right. The amount you get back.

Tivon Loubser: So we’ve included the tax in our financial model. So if you look at our financial model in year ten, you’ll see there is a larger tax payable. What that’s made up of is a recoupment, but the recoupment can only ever be up to 100% or whatever the value of the assets is. Anything over and above that will be CGT. The important part to note there is if you exit in the first two years, SARS have said that they will recoup you on the full 125%. And I think what they realized very quickly when they announced this is people are going to arbitrage it, people are going to invest in the product today, exit next year, and they’ve essentially arbitraged that 25% if they were only recouped at 100%. So I think SARS were pretty smart to that. And they’ve said you’ve got at least a two year lockout where you can’t exit.

The Finance Ghost: Yeah, that does make sense. So with the investment term, the ten years, that is quite long, there might be some liquidity along the way. But I think the message coming through here, loud and clear is if you are going to invest in this, you need to believe that this is money that you do not need back for the next ten years. So if you’re planning to emigrate in two years or, you know, you have other challenges in your life and unfortunately, adulting does happen, you know, then maybe just be careful with the amount going into this or whether or not you get involved. You do need to treat this as something that is a bit of a lockup investment in South Africa. And therefore, I suppose it’s like anything, it should be part of a broader portfolio discussion. I imagine a lot of your clients would work through financial advisors. I’m sure your recommendation would be to speak to a financial advisor as part of understanding this stuff.

Tivon Loubser: I mean, we’ve got our partners at GIB Wealth, and when I speak to the executive team, they always say, 12B is a great product, but it needs to form part of your larger investment base or your large portfolio. I mean, and again, we always say it’s a product for high net worth individuals. You really maximizing your returns when you’re in that top tax bracket. And it’s definitely, if you look at the term sophisticated investors, that’s what it would cater to. So we always advise, chat to your financial advisors, make sure it really makes sense for you, and definitely incorporate it into your overall wealth portfolio. But it’s a very nice way to diversify your portfolio and experience a great tax break while doing it.

The Finance Ghost: Yeah, if you’re in one of the lower income tax bands, then you could go and get yourself a better outcome. In all likelihood, by just investing in interest yielding instruments, you would get that tax free portion each year on the interest as well. So, yes, speak to a financial advisor, understand the maths of this thing and how it all works, see if it is for you. And I guess that’s a good place to end off with. What is the minimum investment size for this thing and what is the right way for people to invest? Should they only be working through investments advisors? Or if they are sophisticated financial investors who can go and do all the maths themselves? Is this something they can do directly with you?

Tivon Loubser: So our minimum ticket size is R100,000. And as soon as you’ve hit that threshold, you can then top up your investment with no limits. So if you invested today and you wanted to invest in June again, as long as you’ve hit that R100,000 threshold, you can invest with no limits. Yeah. So, I mean, we always advise chat to your financial advisors if you have one, if you are a sophisticated investor and if you, if you really understand the mechanisms, you can invest directly with Twelve B. So you can either go to our website, twelveb.co.za, or you can send me a mail, tivon@twelveb.co.za. And I think we rarely tell investors to do your due diligence, whether it’s our product, whether it’s someone else’s product. Set up a meeting with myself or some of our analysts or Jeff, have a chat, really grasp the underlying assumptions, the concept behind it, and then you can make an informed decision whether to go forward or not.

The Finance Ghost: Yeah. Fantastic. And how quickly do people need to move? So what is the timing on this fund? When does it close? And then I think we are done. Today, we’ve learned a lot about solar and how Grovest looks at it.

Tivon Loubser: So we’re closing the fund. What we’ve done is we’ve moved the peg forward to the 30th June. Again, that just gives us more than enough time to deploy all the capital. You know, we are once again very cognizant of that 12BA allowance. And that is one of the major reasons why investors are getting involved. So the fund will close at the earlier of 30th June or R100 million raise. And the raise is currently going very well. The fund also operates on the premise of a first come, first serve basis. So if you want to guarantee your tax allowance, it’s very important to invest soon to further enhance your chances of getting that 12BA allowance.

The Finance Ghost: Fantastic. Well, thank you so much for your time today and to the team at Grovest for doing this with Ghost Mail as well. How do people reach you? I imagine LinkedIn and the Grovest website.

Tivon Loubser: LinkedIn. Grovest website. Twelve B websites. Or again, you can come directly to me tivon@twelveb.co.za

The Finance Ghost: Okay, fantastic. Thank you so much and good luck with the raise and deploying the funds.

Tivon Loubser: Brilliant. Thank you so much, Ghost. Really appreciate your time.

The Finance Ghost: Please do your own research. Discuss this with your independent financial advisor. And if you would like to set up a meeting with the Twelve B team or would like more information, visit the Twelve B or Grovest websites. Twelve B Fund Managers Pty Limited is an approved juristic representative of Volantis Capital Proprietary Limited and authorized financial services provider FSP number 49836.