Born at the dawn of a new century and the new millennium, Shanduka Group takes its cue for growth and empowerment from its name. Shanduka means 'change' in tshiVenda.

• The group holds strategic stakes in 22 listed and unlisted companies

Born at the dawn of a new century and the new millennium, Shanduka Group takes its cue for growth and empowerment from its name. Shanduka means “change” in tshiVenda.

Starting life a decade ago as Millennium Consolidated Investments with Cyril Ramaphosa at the helm, the company aspired to become a “substantial, successful, and credible organisation”, with strong empowerment credentials.

That promise has been realised, with its diversified holdings in resources, energy, financial services, property, telecommunications, industrial and fastmoving consumer goods. The group holds strategic stakes in 22 listed and unlisted companies including Standard Bank, Liberty, Alexander Forbes, Bidvest, Lonmin, Mondi, MacSteel, Seacom, TBWA\Hunt\Lascaris, Coca-Cola Shanduka Beverages and McDonald’s SA.

Shanduka also manages a R300m private equity fund in partnership with Sanlam, Sasria and the Development Bank of Southern Africa. But the big change in Shanduka’s profile has been its evolution from a BEE investment holdings outfit to a company that seeks to own and operate businesses, as evidenced by its majority ownership of the McDonald’s SA chain, with its 150 restaurants across the country, as well as a Coca-Cola Shanduka Beverages bottler.

“When Shanduka started out, its credibility rested on our founder and executive chairman Cyril Ramaphosa,” says Shanduka chief financial officer David Ngobeni. “Today, the company has grown to become a trusted brand in the market.”

As the group intensifies its quest to become one of the leading investment holding companies in Africa, the strength of that brand will be harnessed to strike new deals in a range of sectors, balancing the current bias towards resources.

Given the group’s consistent delivery on shareholder value, does that mean it has achieved what it set out to do?

Group CEO Phuti Malabie stresses that Shanduka has “not yet arrived”, but that its journey to greatness is progressing well. “We find ourselves at an interesting point in our history — that of reflection and a refocusing of our strategy. We are confident that innovative ideas will come out of this, with a significant impact on what happens to the business in the next five to 10 years.”

Already, Shanduka is making inroads into the rest of Africa, with key investments in East and West Africa. The group’s shift into operational businesses has required a strong focus on acquiring the core skills that will stand it in good stead as an operator, while it continues to deliver on its founding mandate of BBBEE.

“As a black business, we have been able to take advantage of what is an enabling environment in terms of BBBEE,” says Malabie. “But we think it’s now time to control chosen businesses. What we want is to be in a position where Shanduka is able to influence decisions. It cannot do so as a minority shareholder.”

The group has a management track record. Coca-Cola Shanduka Beverages is the group’s first majority-owned (70%) operational business. It is the smallest of the four bottlers in SA and has twice won the Bottler of the Year accolade since it’s been under Shanduka.

“Looking at our bottling business, we were able to put a new management team in place, including a black CEO and CFO, and we have gone from being a level 7 business to level 2 according to the department of trade & industry codes of good practice,” says Malabie. “Not many businesses have achieved that.”

The group is also looking to expand its footprint in property, a quest given new impetus by the acquisition of McDonald’s, with its significant real estate portfolio. “Whatever we do, we want to ensure it’s for the greatest benefit of all our stakeholders.”

The approach, she says, is part of Shanduka’s commitment to creating value for its shareholders, which include the Ramaphosa Family Trust, Investec, Standard Bank, Old Mutual Investment Group, Lilitha Strategic Investment, board member James Motlatsi, management and staff of the group.

But the group is also driven by a strong focus on empowering and transforming lives in the broader communities it serves, says Malabie. The chief driver here is the Shanduka Foundation, a community-investment vehicle dedicated to education and the support of emerging black entrepreneurs.

Through its Adopt-a-School Foundation, in partnership with several other SA firms, Shanduka has made a difference in the lives of 175000 pupils in 130 schools. Shanduka Black Umbrellas is helping SA address its low levels of successful and sustainable small, medium and microenterprises by providing those that are 100% black-owned with infrastructure support, training and mentorship.

“Corporate SA is not able to absorb all the young people coming out of schools,” says Malabie. “That’s why young people need to start thinking of becoming entrepreneurs.” She also hopes future entrepreneurs will be able to find some inspiration in the success story of the fast-growing Shanduka group itself.

Source: Financial Mail