27four Investment Managers
20th May 2019
Transformation remains a challenge
Black asset management firms continue to be underrepresented in terms of the savings and investments they manage. According to a report by 27four Investment Managers in 2018, black-owned firms manage just 6% of all savings and investments and just 0.8% of unit trust assets in SA. The report adds that only R490bn of the R8.7- trillion assets under management are managed by black firms. Around R5-trillion is available for management by the private sector.
The Public Investment Corp (PIC) is one of the large funds that supports black asset managers. Last year it allocated more than RI00bn to black asset managers. The industry’s move towards umbrella funds and the closure of a number of standalone retirement funds has affected independent black asset managers who rely on the latter, says Fatima Vawda, founder and MD of 27four Investment Managers.
The Financial Sector Transformation Council has included a voluntary scorecard for retirement funds in its code, and this scorecard is likely to become compulsory, she says. In the past two years a number of asset management firms have pursued ownership deals in order to improve their BEE rankings. One of these was Prescient Holdings, which recently announced that its BEE deal had obtained regulatory approval.
The deal means Sithega Holdings, a black-owned investment company founded by former Liberty CEO Thabo Dloti and Discovery Insure co-founder Thembalihle Baloyi, will acquire a controlling interest in the Prescient Empowerment Trust for R360m. “There is pressure for the percentage of local savings and investments to be managed by black-owned firms to grow,” says Willem Venter, CEO of Prescient Holdings. This trend is explicit in terms of legislated and tender requirements. He is confident that Prescient presents a compelling offering for all investors.
Special Report compiled by Lynette Dicey
Financial Mail | May 16 – May 22