20 Jan 2014 OPINION: Reflecting on a special CEO, Graham Mackay
Graham Mackay used to say his performance review as CEO of SABMiller was simple, and available for everyone to examine: the company’s share price.
Many things affect equity markets, of course, and one cannot read too much into the fact that SAB was at around R50 on the JSE in 1994 and again (as SABMiller) in early 2003, having twice touched levels around R80 in the intervening eight years.
But over the decade since, SABMiller’s spectacular growth by acquisition, alongside steady organic growth in most markets, prompted an almost uninterrupted rise in the share price from R50 to this week’s R537.
If you had invested R1000 in SABMiller 10 years ago, you would now have more than R10000 in share price combined with dividends reinvested – average annual growth of 26%. Other companies on the JSE have done better, but not many of them are heavyweight market caps.
It can be argued that the SAB listing in London in 1999 turned out to be the solitary success of its kind. It is easily forgotten now just how high emotions ran when these listings were mooted.
There was a strong feeling at the highest levels of government that iconic SA corporates were being unpatriotic and lacked confidence in the future under the ANC. These sensitivities had to be carefully handled, and nobody was more adroit at doing so than Mackay, supported by Meyer Kahn as chairman and Norman Adami as CEO of the SA beer interests.
Then Mackay was also driving a profound change in the business model of SAB. When he took over as CEO in 1997, SAB was a giant conglomerate with interests in sectors as diverse as property, glass, hotels and shoes, and in retail companies like Lion Match and OK Bazaars…..