BDC eyes external markets
The state-owned investment arm, Botswana Development Corporation (BDC) this week made it known they are more than ready to expand beyond the borders of the country, taking advantage of the current bullish investment opportunities in the continent. The company’s Managing Director, Bashi Gaetsaloe made the revelation this Tuesday after BDC facilitated a deal which will ensure Transport Holdings (TH) is 100 percent citizen owned.
TH, one of the biggest logistics companies in the country was previously partly owned by a South African logistic firm, Imperial Group. Some five years ago, government, which is the sole shareholder of BDC gave the company (BDC) the go ahead to start investing outside the country. The Johnny-come-late, BDC will find other state owned enterprises such as the South African Industrial Development Corporation (IDC), already taking advantage of Africa’s economic growth.
IDC, which was formed in 1940 has invested in projects all over Africa. A hyped-up Gaetsaloe, who has been at the helm of the company for more than three years is confident the time is now to spread wings and rip the benefits as long as they last. “Africa is an exciting place to be right now and analysts, investors, and economists have all remarked, ‘Ignore Africa at your peril.’ We believe that Africa is our ‘back-yard’ and have taken a deliberate strategy to invest across Africa,” said the BDC top executive.
Gaetsaloe is perhaps inspired to expand in the region and Africa by the fact that, some countries in Africa are currently recording Gross Domestic Product(GDP) rates ranging between 5 percent and 8 percent. “Serious business people looking for growth and new markets must look at the region and the continent,” said Gaetsaloe, whose area of specialisation include investment strategy, development finance, business strategy, organisational transformation, among others.
BDC has not stated which countries they will expand to in the short to medium term, or which sectors in the African continent they will fund. Transport Holdings, which they have just helped through P160 million deal has ambitious plansof expanding further into Southern African Development Community (SADC).
Gaetsaloe, who has now roped in a corporate deal maker-Moatlhodi Lekaukau as Chief Investment Officer market, said the country’s narrow also makes them eager to taste unchartered waters outside. With its credit ratings status done by reputed Moody’s,BDC will release as much as P700 million from their war chest into new projects at home and abroad.
Last year, the Corporation injected P600 million into new businesses and managed to make a Profit beforeTax (PBT) of P150 million. BDC has announced itwill be using different funding models if the needs to raise more for projects arise.“As an A-Rated government and with BDC’s own investment grade rating of Baa2 – we can export highly competitive financial services and products and do so profitably and sustainably.
This is one of our competitive advantages as a country and as BDC,” said Gaetsaloe in a prepared speech. Writing in the company’s 2017 annual report, the Chairman of BDC, Blackie Marole noted that the Corporation is seeking opportunities to mobilise resources together with African partners that can be deployed strategically to advance the development of Botswana, the region and the continent. “Financial sustainability is imperative for the Corporation to continue delivering on its mandate in the long run,” said Marole.
Meanwhile, Minister for Investment, Trade and Industry, Bogolo Kenewendo, under whom BDC falls, told attendants during the BDC/Transport Holdings transaction on Tuesday that BDC remains an important cog of government. “BDC remains mandated to developing the commercial and industrial sector through funding of commercially viable ventures and partnerships with local and foreign investors”.