Johannesburg- It’s been a big year for business deals. And black players in the economy have not been left out, flexing their muscles in a tough economic environment.
Billionaire Patrice Motsepe was probably involved in one of the most transformative deals this year. Banking group Absa and insurer Sanlam said in October they would combine their asset management businesses in a deal that would result in a business with assets under management, administration and advice in excess of R1-trillion.
The two companies said Absa would exchange its investment management business, Absa Investments, for a stake of up to 17.5% in the asset management company that Sanlam created with Motsepe’s African Rainbow Capital called Sanlam Investment Holdings Proprietary Limited.
The new entity to be formed after the completion of the merger terms is expected to be one of the country’s largest money managers after the state-owned Public Investment Corporation.
Motsepe’s company Ubuntu-Botho Investments is the largest shareholder in Sanlam with ownership of 14%.
The Thesele Consortium, led by the 100% black-owned Thesele Group, in August completed the deal to buy Bidvest Car Rental (BCR) from the listed Bidvest Group after competition authorities gave the transaction the thumps up.
Potential suitors started circling BCR last year after its parent company announced that following a detailed strategic review of all Bidvest businesses, it had decided to divest from BCR and Bidair Services. BCR has a car fleet worth about R1.5-billion and a workforce of 1 200.
Thesele Consortium is a joint venture between Thesele Group, Hallmark Motor Group and Mortimer Motors Group. No strangers to each other, the consortium has a proven track record on previous joint ventures and brings over 50 years’ worth of motoring industry experience to the table.
Thesele Group was founded in 2005 by renowned businessmen Sello Moloko and Thabo Leeuw. Moloko was recently appointed chairperson of the Absa board.
Courier company SkyNet in November announced that the SkyNet operations in South Africa, Namibia, Mozambique, the United Kingdom, Belgium and Germany had been acquired by RMB Ventures, Bopa Moruo Private Equity and New GX Capital Holdings (New GX).
Bopa Moruo is a 100% black-owned and black-managed private equity management company run by Nthime Khoele and Boitumelo Tlhabanelo.
Founded in 2011, Bopa Moruo has become a formidable mid-market private equity firm. Some of its investments include DSD Shopfitters, which specialises in gaming tables, slot bases, boardrooms, and furniture manufacturing for the hotel and gaming industry.
One of its other prominent investments is Sanitech, a mobile sanitation and hygiene solutions provider in southern Africa. New GX was founded by Khudusela Pitje, who is its CEO. The company has investments in the energy, infrastructure and telecommunications sectors.
Seriti Capital Partners (SCP) in September bought Cannon Asset Managers from Bidvest Financial Services for an undisclosed amount. In a fairytale story, Cannon’s former employees Tshepo Modiba and Deshan Naidoo are now at the helm of the company that has assets of more than R400-million under management.
SCP was founded this year by Modiba and Naidoo.
The asset management industry in South Africa is dominated by white-owned companies with few opportunities going to black companies. Scale is a challenge for black managers. While there are new firms launched regularly, they struggle to gain critical mass due to lack of support from trustees, institutions and asset consultants.
According to BEE.conomics Transformation in SA Asset Management Survey published by 27four Investment Managers annually, there are 48 black asset management firms in South Africa and they manage less than 15% of the R5-trillion industry.
Deals that also stood out is the Heineken buyout of wine and spirits maker Distell for R38.4-billion, creating a new regional group to compete with larger rival Anheuser-Busch InBev and spirits giant Diageo.
Dubai-based DP World also acquired JSE-listed Imperial Logistics for R12.7-billion.
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