A Cape Town-based investment firm managed by anti-apartheid activists is banking on growth opportunities within South Africa's healthcare system.
Iqbal Surve, M.D., who serves as chief executive officer of the $50 million Sekunjalo Investment Group, hopes to spin off its healthcare division into a publicly traded organization by year-end.
"We'd be the first black chip healthcare stock on the Johannesburg Stock Exchange," Surve says. Last month, the company started limited over-the-counter trading of its shares.
Healthcare accounts for about two-thirds of the firm's investment portfolio. Its holdings include outpatient clinics, surgical supply manufacturers, medical product distribution companies and a pathology laboratory. Surve says the firm also has discussed deals with a private hospital company and a drugstore chain. Outside healthcare, Sekunjalo has invested in fitness clubs, agriculture, financial services and plastics.
Sekunjalo is Xhosa for "now is the time," the campaign slogan and rallying call of President Nelson Mandela's African National Congress party. It is one of the 10 largest empowerment funds recognized by the new government to promote private investment in South Africa's struggling economy. As a result, it enjoys tax breaks and preferential treatment on public contracts.
The firm's board of business executives, politicians and academics is multiracial; most of the members were active in the movement to end apartheid.
Surve, for example, is a sports medicine physician of Indian ancestry. His uncle served 14 years at Robben Island, where Mandela spent 18 of his more than 27 years in prison.
"We've enjoyed a political miracle," Surve says. "Now we need an economic miracle that creates jobs, encourages entrepreneurs and builds investor confidence. Only then can South Africa say it has overcome oppression and rightfully take its place as the economic engine of subSahara Africa."
Moreover, he believes the private sector must play a leading role in improving the quality of healthcare in South Africa.
"The government doesn't have the resources or expertise to manage a nationalized system," Surve says. "Investment capital and smart management can solve many problems."