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The South African rand experienced a significant drop to a 2023 low of 18.636 local currency units per dollar on March 7, just weeks after reaching its strongest exchange rate versus the U.S. dollar.
The depreciation of the rand has resulted in downward pressures on asset values and company valuations, which could potentially threaten the net worth of South African billionaires.
The rand’s decline is attributed to several factors, including expectations of higher U.S. interest rates, weaker-than-expected growth data, power shortages, and the country’s recent grey-listing by the Financial Action Task Force (FATF).
The South African rand has experienced a significant decline since reaching its peak on Jan. 12, 2023, plunging nearly 10 percent and resulting in a year-to-date drop of seven percent. As a result, it is currently one of the worst-performing African currencies this year.
The rand’s depreciation has been attributed to various factors, including the country’s grey-listing by the FATF, which aims to combat money laundering and terrorist financing, as well as ongoing electricity shortages that have led to extended blackouts for many homes and businesses. South African President Cyril Ramaphosa has responded by appointing the country’s first minister of electricity.
As a result, about five out of the possible seven South African billionaires, whose wealth is predominantly tied to companies operating in South Africa, are expected to see significant declines in the market value of their assets and stakes – including Stephen Saad, whose net worth remains below $1 billion.
According to data tracked by Billionaires.Africa, these are top five South African billionaires whose net worth could potentially be impacted by the recent depreciation of the South African Rand against the U.S. dollar in 2023.
#1 Patrice Motsepe
Patrice Motsepe, a highly accomplished South African billionaire, is widely recognized as one of the most successful businessmen in the country.
In addition to founding African Rainbow Minerals (ARM), a prominent mining company with diversified interests in precious metals, coal, iron, copper, and more, he has also established Ubuntu-Botho Investments and has a significant ownership stake in African Rainbow Capital.
Motsepe’s net worth primarily stems from his impressive 39.7-percent stake in ARM, which is currently valued at $1.2 billion.
The recent devaluation of the rand has seen the market value of his stake shed $90 million.
#2 Michiel Le Roux
Michiel Le Roux, the founder of Capitec Bank, one of South Africa’s prominent retail banks, is considered among the wealthiest businessmen in the country due to his 11.41-percent stake in the Stellenbosch-based banking firm.
Presently, his stake in Capitec is worth $1.23 billion, though its market value would have been $1.32 billion if not for the recent depreciation of the rand.
#3 Koos Bekker
Koos Bekker, a prominent South African billionaire, is renowned for his shrewd investments and business acumen that paved the way for the success of companies like Naspers – a multinational holding company headquartered in Cape Town, and Prosus N.V. – an investment group based in Amsterdam.
Bekker’s net worth of $2.4 billion is primarily derived from his 0.96-percent stake in Naspers and 0.89-percent stake in Prosus NV. Presently, his stake in Naspers is valued at $700 million, reflecting a $50-million decline in its market value due to the recent depreciation of the rand.
#4 Christoffel Wiese
Christoffel Wiese, the South African billionaire who amassed his wealth through the success of his Pepkor retail empire, owes a significant portion of his fortune to his 11.63-percent stake in Shoprite, the largest supermarket group in Africa, as well as his holdings in Tradehold, Brait, and Invicta Holdings.
His stake in Shoprite, which generates 80 percent of its sales from South Africa, is presently valued at $820 million, reflecting a $60-million decline in its market value due to the recent depreciation of the rand.
#5 Stephen Saad
South African billionaire businessman Stephen Saad is the brain behind Aspen Pharmacare Holdings — a leading global specialty and branded pharmaceutical firm with its headquarters in Durban, South Africa.
Saad’s 12.5-percent stake in the company accounts for the majority of his wealth.
Presently, his stake in Aspen Pharmacare is valued at $570 million, reflecting a $40-million decline in its market value due to the recent depreciation of the rand.
