Business
Largest Investor, Elias Masilela, in South African Stocks Wants Local Ownership
Exporting Technology
Opportunities are not only through investment into South Africa, Masilela said. Johannesburg-based Sasol Ltd, the world’s biggest producer of liquid fuels from coal, plans to make a final investment decision this year for an ethane cracker project in Westlake, Louisiana, and a gas-to-liquids plant at the site 18 to 24 months later. This will make South Africa a significant exporter of technology to the U.S., he said.
“We are exporting key technology which is going to change the U.S. forever,” Masilela said. “We’ve always been an exporter of dividends, we’re now going to be an importer of dividends.” PIC is the biggest shareholder in Sasol, with a 12.3 percent stake, according to data compiled by Bloomberg. The fund manager has about 93 percent of its assets in South Africa and invests about 55 percent of its assets in listed equities, 35 percent in debt and 5 percent in property. Developmental investments have been allocated 5 percent.
African Opportunities
“Of its total investments PIC has 2 percent invested in the rest of Africa and 5 percent outside the continent. In Africa outside of its home market, West Africa has the biggest share of its investment because of the region’s potential for economic growth,” Masilela said. The economy of Nigeria, Africa’s most populous country, has expanded an average of 8.2 percent annually since 1999.
PIC has invested in four companies on the continent outside of South Africa, namely Ecobank Transnational Inc. (ETI), Dangote Cement Plc (DANGCEM),Camac Energy Inc. (CAK:US) and Tanga Cement Co. It plans to announce more investments soon as pointed out by Masilela while declining to give further detail.
The lack of large stock markets in these countries means PIC will mostly invest through private equity, property and infrastructure, he said. The company’s investment in Africa is welcomed, he said and doesn’t generate the opposition that some investments from countries like China do.
Masilela said, “Yes, there may be a selfish end in developing those economies, because we would like to develop new markets for S.A. Inc.” However, he then added, “But we do it in partnership with receiving economies. This is completely different from what the Chinese are doing, the Chinese go there with a mentality to conquer.”
Source: Bloomberg Businessweek
