Pamodzi Investment Holdings: To List or Not to List?

Author :

Claire Beswick; Mthuli Ncube

Pages :

13

Product Type :

Case

Reference # :

WBS-2009-14

Teaching Note :

Institute:

Wits Business School

Setting:

Johannesburg

Year:

2008

Keywords:

Strategic finance, entrepreneurship, leadership, strategy, BEE, listing.

Summary/Abstract:

In January 2008, the black-owned Pamodzi Investment Holdings (PIH) was at a crossroads, as its chief executive officer (CEO), Ndaba Ntsele, sat down with his board to discuss how to finance the growth of the business. Ntsele and co-director, Solly Sithole, had founded PIH’s predecessor, Pamodzi Property Developers, and grown it from nothing in 1979 to a multi-million rand concern, using only debt finance and working capital. PIH, founded in 1997 to take advantage of the opportunities presented by black economic empowerment (BEE) deals, had followed the same funding strategy. But Ntsele wanted to grow PIH into an organisation comparable in size and stature to Anglo American or Bidvest, and he was not sure that PIH could achieve these aims using the same strategy as in the past. The board was, therefore, considering whether or not to list the company and, if not, how they could raise the funding necessary to achieve the strategic goals of the business.