SA Private Equity Continues To Perform Well

Updated on 18 August 2017

Subscription Form (#66)

Today's Top Entrepreneurship and Business Stories (18 August)


The latest RisCura-SAVCA South African Private Equity Performance Report revealed that the South African private equity industry outperformed listed equity over the short-term. The industry also outperformed the FTSE/JSE All Share Total Return Index (ALSI TRI) and FTSE/JSE Shareholder Weighted Total Return Index (SWIX TRI) in the long term as at 31 March 2017.

The first quarter 2017 report – which tracks the performance of a representative basket of private equity funds in South Africa – showed that the industry’s ten-year performance relative to the listed market remains favourable over this period. The public market equivalent (PME) measure, which has a value of more than one when private equity outperforms listed equity, is greater than one when calculated against the FTSE/JSE Shareholder Weighted Total Return Index (SWIX TRI) and the FTSE/JSE All Share Total Return Index (ALSI TRI). The latter reported the greatest outperformance by recording a PME ratio of 1.11.

Tanya van Lill, CEO of the Southern African Venture Capital and Private Equity Association (SAVCA), says that this sustained outperformance demonstrates the value that the private equity asset class is able to bring to a portfolio amid times of market volatility and lagging economic growth. “While South Africa continues to exhibit sluggish levels of growth, certain industries remain ripe with opportunity for private equity capital and, as a result, the asset class continues to deliver impressive returns.”

While a ten-year measurement period is considered appropriate for private equity, given the long-term characteristics of the asset class, the report reveals a similar pattern of returns over shorter time periods.

The report shows private equity returned 14.2% from 1 January 2007 to 31 March 2017, compared with the return of 9.8% from the FTSE/JSE All Share Total Return Index (ALSI TRI) over the same period.

The industry outperformed the FTSE/JSE Shareholder Weighted Total Return Index (SWIX TRI), which recorded a 10.6% return over the equivalent ten-year period. Private equity slightly underperformed the FTSE/JSE Financial and Industrial Index (FINDI TRI), which yielded 14.3% over the decade to 31 March 2017.

Africa Green Forum To Promote Sustainable Rural Development In Africa

The 2017 Africa Green Revolution Forum will be held from September 4-8 in Abidjan, Côte d’Ivoire, and aims to stress the capacity of agriculture and agribusiness to drive inclusive and sustainable rural development in Africa.

The Forum will spotlight the important role agriculture and agribusiness play in current efforts to diversify African economies.

The 2017 Africa Green Revolution Forum, considered to be the most important meeting on African agriculture this year will be held under the patronage of Côte d’Ivoire President Alassane Ouattara.

The theme of the event is “Accelerating Africa’s Path to Prosperity: Growing Inclusive Economies and Jobs through Agriculture”.

The Forum is hosted by the Alliance for a Green Revolution in Africa (AGRA), an African-led institution focused on putting farmers at the centre of the continent’s growing economies, and is built on an alliance of partners that care about, commit to and invest in Africa’s agricultural transformation.

The partners include the African Union, African Development Bank, African Fertilizer and Agribusiness Partnership (AFAP), AGRA, Food and Agricultural Organization of the United Nations (FAO), International Fund for Agricultural Development (IFAD), The MasterCard Foundation, NEPAD, OCP Africa Group, The Rockefeller Foundation, The Southern African Confederation of Agricultural Unions (SACAU), Syngenta, and YARA International.

The Forum will bring experts and other stakeholders together to guarantee that the importance of agriculture to African economies is not overlooked.

Agriculture represents more than 70 percent of employment, making it essential to delivering on economic development visions for the continent and achieving the Sustainable Development Goals.

Agriculture is a dynamic sector, offering a multitude of opportunities for entrepreneurship along the entire agribusiness value chain, said Boaz Keizire, Head of Policy and Advocacy for AGRA.

“Africa’s transformation can be realised by catalysing an entrepreneurial environment that starts on the farm,” said Keizire. (via African News Agency)

Get Weekly 5-Minutes Business Advice

Subscribe to receive actionable business tips and resources.

Subscription Form (#66)

Feeling Stuck?