The Public Investment Corporation (PIC) is seeking to appoint a panel of turnaround specialists in a last-ditch effort to stabilise its troubled multibillion-rand unlisted portfolio, particularly its controversy-hit property division.
The asset manager’s Isibaya fund was formed to invest in projects that promote social responsibility, infrastructure and transformation in SA and the rest of Africa.
However, much of the portfolio has underperformed.
The situation deteriorated so much that the Government Employees Pension Fund, whose assets are managed by the PIC, last year temporarily withdrew its mandate for the company to invest in the unlisted space.
Parliament was told last year that more than 40% of its unlisted portfolio was in distress after a sustained period of underperformance.
One of the mandates the board gave to new PIC CEO Patrick Dlamini was to clean up its multibillion-rand unlisted portfolio.
The PIC has gone to market seeking a panel of experts to analyse and evaluate troubled companies in the portfolio and to return them to solvency or reduce the losses and exposure of shareholders and funders.
The panel, according to the PIC, must comprise turnaround professionals, liquidators, business rescue professionals and property specialists.
The panel will also be tasked with identifying the reasons for failing performance in the market and instituting corrective measures.
Long-term strategic plan
The PIC expects the end of the panel’s process to lead to the production of a long-term strategic plan and restructuring plans, dependent on the viability of the asset.
A pain point for the PIC has been its unlisted properties division, which is expected to promote economic transformation and socioeconomic development through direct property ownership and equity investments in unlisted entities.
The portfolio comprises 410 assets with an aggregate market value of about R61.95bn.
The assets are located in Gauteng and the Western Cape, with the portfolio primarily concentrated in retail and specialised property sectors.
One option available to the turnaround panel is deciding on the support required for the investee company, which might include governance changes for an asset in which the PIC has “high-influence or controlling” interest.
Turnaround specialist
Dlamini was appointed to the role of PIC CEO in June, putting him at the helm of the largest investor in SA’s equities market.
He was formerly CEO of the Development Bank of Southern Africa, a role he held for a decade until stepping down in 2023.
Dlamini has built a reputation as a turnaround specialist.
The DBSA under Dlamini’s tenure more than doubled its assets, breaching the R100bn mark for the first time in 2020.
At the time of his appointment, PIC chair David Masondo said Dlamini, working with management, would be expected to apply his turnaround expertise to address the immediate concerns that confront the PIC, “specifically in its unlisted portfolio”.
By October, the PIC’s investments in the unlisted space came in at more than R120bn.
The Isibaya fund had gross loans of R69bn at end-June 2025, of which R35.5bn was impaired, resulting in an impairment ratio of 51.5%, legislators were told in October.
The PIC has so far resisted calls to transfer its unlisted portfolio to DBSA or the Industrial Development Corporation, insisting most of the underperformance was driven by historic transactions rather than by new investments.
One of the unlisted investments that made headlines last year was poultry producer Daybreak.
The problems besetting Daybreak, founded in 2001 with operations spanning four provinces, came to the fore in 2024 when it began paying suppliers and salaries late or not at all.
The National Council of SPCAs last year won a court order after the starvation of 594,000 chickens in Daybreak’s facilities was exposed. — Business Day
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