As a BEE pioneer, over the past few years KTI has evolved from a typical opportunistic BEE investor to becoming a strategic investor and shareholder. KTI is of the view that in order to survive in the era beyond BEE, black-owned companies need to move away from opportunistic trading in assets, and should instead seek to exert influence over core strategic holdings where they can demonstrate expertise. To this end, KTI is consolidating its businesses around two pillars:

• Financial services
• Industrial and ICT.

Key strategic drivers behind the restructuring

• Structural and management re-engineering
• Clustering businesses into segments led by management and dedicated executives
• Acquisition of targeted enterprises in selected segments to build scale
• Pursuit of controlling stakes in current and prospective investments
• Effective capital management
• Clarity of vision
• Reputational integrity
• Alignment of structure with strategy at all levels
• An entrepreneurial working environment
• Clear internal and external communication.

Developing a corporate DNA

The overarching element of KTI’s corporate DNA will be trust, which is its legacy and ethos: The difference is trust.

The growing of this corporate DNA will differentiate KTI from its competitors, bind all entities within the Group and build unity and consistency.

Key components of KTI’s DNA

• A spirit of entrepreneurship
• Consistency and reliability
• Leadership in all it does
• Trust in relationships with clients, partners and all stakeholders.

A focus on three core areas

Within this new strategic framework, the objective is to develop a financial services offering, with critical mass and scale in its activities, with a focus on three core areas:

• Investment banking services
• Life insurance
• Short-term insurance.

The rationale for this clustering of businesses

• Developing a strong footprint in well niched financial services areas
• Incubating small to medium businesses in financial services with huge growth potential
• Ability to assemble internally, highly specialised and complementary financial services skills, for example, for corporate bond issues to service clients
• Financial services offering to be focused on value-adding services.

Benefits of the restructuring

• A focus on nurturing entrepreneurial flair, energy and drive
• Providing focused KTI leadership, guidance and value system
• KTI business support and networks
• Opportunities for joint product development
• Co-ordinated approach to business development and marketing
• Co-ordinated access to new markets and strategic relationships.

The restructuring will take the Kagiso Group from where it is, which is a number of small niche players, and provide an integrated critical mass. This means that it will have much more muscle in the market.