IDC looks beyond the state to rebuild its war chest
South Africa's Industrial Development Corporation (IDC) is considering private shareholding for the first time to recapitalize and support industrial growth. The move aims to strengthen the institution's ability to fund developmental projects without losing state strategic control.
Why it matters
It represents a significant shift in state-owned enterprise management in South Africa as the government seeks to revitalize the manufacturing sector.
The Industrial Development Corporation (IDC) aims to introduce private shareholding for the first time in its 86-year history to shore up its coffers and enable it to play a bigger role in the bid to re-industrialise South Africa’s economy.
While still Africa’s most industrialised economy, South Africa has over the past two decades lost significant manufacturing capabilities, with imports overrunning many domestic companies.
IDC CEO Mmakgoshi Lekhethe told Business Day the state-owned development finance institution had put all its cards on the table in a bid to seek a significant recapitalisation, including inviting private sector investors as equity partners.
“We are looking at all options to beef up the capacity of the IDC to take on its developmental role. We are also exploring various ways to recapitalise the business,” Lekhethe said.
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