Is South African merger control raining on private equity’s Dezemba

Chris shared that investor sentiment is trending positively, which should, in principle, energise South Africa’s private equity (PE) sector—a space that has faced challenges in recent years.

Chris highlighted the benefits of a dynamic PE sector for the economy, noting that the dual competition for investors’ funds and high-potential investment opportunities drives innovation and growth. Successful PE investors bring more than just capital; they foster rapid portfolio growth, secure demonstrable returns, and build a reputation to attract future funding and opportunities.  There is also evidence to show that PE investment drives competition in the industries in which PE firms invest.  

Chris compared South Africa’s PE approach with the debt-heavy, short-term operational improvements sometimes criticised in the US. In South Africa, progressive labour laws, active unions, and stringent merger control rules make a cynical, extractive strategies sub-optimal.   Instead, local funds focus on sustainable growth—a necessity in an economy where even a single failing firm can disrupt entire industries.  As a result, there is perhaps good reason to encourage PE from a merger control policy point of view.   

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