RBH’s primary mandate is to build a diversified, growth-orientated investment portfolio on behalf of the RBN.
RBH is a long-term value investor. Its approach is to acquire significant equity stakes in high-quality listed and unlisted companies in the mining, industrial, services and financial sectors. Once a core portfolio has been established, RBH will always consider increasing its shareholding in existing investments as an alternative to investing in new companies.
The RBH’s current portfolio has an estimated value of approximately R33.5 billion, with the potential to grow considerably over the next few years. Diversification away from mining over time remains a fundamental objective.
Potential investments are screened and analysed using predetermined criteria that are consistent with the RBH’s overall investment strategy. RBH is an active and participative shareholder. While RBH does not seek to manage the operations, RBH executives participate in strategy and governance issues, and sit on the boards of the investee companies.
The fundamental profit performance of each investment is the primary determinant of long-term returns. RBH seeks to further enhance its return on equity by exploiting the current BEE dynamic in negotiating the price and structuring terms, of each investment.
Overall, the portfolio is funded by a combination of equity capital contributed by the RBN and by prudent levels of structured debt, secured against the cash flow from the underlying assets.
The board retains full and effective control over the company and is responsible for strategic direction, operational and financial performance, major investment expenditure and stakeholder communications.