PSG: Well-Managed South African Investment Holding Company

This article is excerpted from a letter by MOI Global instructor Rudi van Niekerk, founder and principal manager of Desert Lion Capital in Cape Town, South Africa.

PSG Group, or simply PSG, is one of our cornerstone holdings in Desert Lion’s portfolio. This section will expand upon our briefer commentary in the main body of the letter.

PSG is an investment holding company consisting of underlying investments that operate across a range of South African industries including banking, financial services, education, food, and earlier-stage investments in select growth sectors. The group is run by a highly entrepreneurial management team with a stellar capital allocation track record. Since inception November 1995, PSG has delivered to its shareholders returns exceeding 40% per annum.^[1]

PSG has an interesting history. The roots of the group lie in a period of deep introspection by Jannie Mouton after he was fired by his partners at a brokerage firm just short of his 50th birthday. Below are excerpts from a speech he delivered summarizing 20 key lessons he learnt over two decades building PSG. Although Jannie retired in November 2018, these principles are deeply institutionalized in the company and its management team, and instructive to those wishing to understand the culture of the group.

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