LETTER: Offshore investments were not reckless
Never before had Famous Brands undertaken such a comprehensive due diligence
Your editorial on “Rush Offshore Wreaks Havoc” (March 12) refers.
At the time when South African companies were all being encouraged by the market to seek offshore investments, thanks to the chaos created in our local economy through the antics of former president Jacob Zuma, those boards and executive leaders who did so were lauded and praised to the rooftops.
Several years later and the same boards and executive leaders have become the subject of criticism, especially from certain parts of the financial media.
The suggestion in some quarters that these acquisitions were done on a wing and a prayer are preposterous. I can testify to that in the case of Famous Brands.
Never before had the group undertaken as comprehensive and deep dive a due diligence than was the case for Gourmet Burger Kitchen (GBK). This included an army of legal and financial advisers and numerous investment and risk committee meetings, attended by some of SA’s best leadership brains trust. I am sure that the same can be said for certain other companies that have done similar offshore transactions.
Agreed, there have been setbacks and disappointments surrounding certain of these forays into foreign markets, some of which could never have been foreseen at the time.
I suggest though that most of them will recover, but this will require time, patience and dogged determination.
Former CEO of Famous Brands