What else does Joffe have up his sleeve?

It was barely a month ago that deal-making dynamo Brian Joffe expressed his determination to quickly grow the market capitalisation of his new investment company Long4Life to R10bn.

So the proposed acquisition of footwear and clothing brand Rage for R3.9bn — in a paper and cash deal — does not come as a huge surprise.

Long4Life, which is already in the specialist consumer space via its investment in Holdsport, needed a mega-deal to sustain market interest in Long4Life.

It’s clear that some punters still remain wary of Long4Life, discounting the chances of Joffe emulating the rapid acquisition strategy that built the old Bidvest into such an imposing corporate beast. The starkest difference between Long4Life and the old Bidvest is that the former is attempting to build scale rapidly with large transactions whereas the latter scaled up quickly by making regular, small incursions. Clearly Long4Life takes on more execution and strategic risk by pursuing assets with big price tags, but one needs to remember that Joffe learnt a thing or two about assessing deals during his more than 25 years at the helm of Bidvest.

The inferred earnings multiple for Rage might also be perceived as demanding, especially for a bargain hunter like Joffe. But the Rage vendors are taking a chunk of Long4Life shares as settlement, effectively securing an influential stake of nearly 23% on a three-year lock-in.

Not only does the appetite for scrip underline the vendors’ belief in Rage’s better-thanaverage growth prospects but also gives a well-informed thumbs-up to Joffe’s longerterm strategy for Long4Life.

What next for Brian we wonder? Perhaps Tekkie Town?

The R10bn investment by Mercedes-Benz in its East London plant is a breath of fresh air for the struggling South African economy. Despite being a massive sum, though, it is also only about 1% of the $100bn that President Cyril Rampahosa wants invested in SA over the next five years.

Ramaphosa’s economic adviser, Trudi Makhaya, has told South Africans this target must be driven by local investors, so there is a need for a sea-change in attitudes towards the country — from within.

Inward investment was always going to define the trajectory taken after 1994. But 10 agonising years of state capture under former president Jacob Zuma have led to a mountain of private sector cash being withheld from fixed capital investment in SA.

Makhaya says the past three years have been particularly bad for fixed capital formation. She also says the state cannot be overprescriptive in terms of new investment and will have to enable the private sector to pursue projects that will yield results. One of Ramaphosa’s four special investment envoys, former Standard Bank CEO Jacko Maree, says government debt is high, which makes it difficult to stimulate the economy.

To this end, at least $50bn has to be raised by SA’s private sector and hopefully foreigners will follow. But investors need policy certainty, Maree says.

Unlike policy in the country’s mining and petroleum industries, the government’s Automotive Production and Development Programme has been a singular success.