DealMakers’ awards are based, essentially, on objective evidence – the value of deals or transactions, and the number of them. In limited instances, judgment has to be applied on the categorisation and value ascribed to a particular deal or transaction. In only five of the awards is selection subjective, and we approach these with considerable circumspection. All five are Gold Medal awards and they are for the Deal of the Year, the Private Equity Deal of the Year, the BEE Deal of the Year, the Business Rescue Transaction of the Year and the Individual DealMaker of the Year.     

 

Nominations received by industry participants are reviewed by the editorial team, which produces a list of those it believes best qualify for consideration. The list, together with additional information for each nominee in each of the categories, is delivered to members of the Independent Panel who produce a short list and winner for each award.

 

The Independent Panel for the 2021 Awards was chaired by Bernard Swanepoel, former CEO of Harmony Gold and Village Main Reef, and current chairman of the Joburg Indaba. Other panellists include Phuthi Mahanyele-Dabengwa, co-founder of Sigma Capital, former CEO of Shanduka and current CEO of Naspers SA, and Nicky Newton-King, a corporate finance and securities regulation lawyer and former CEO of the JSE.

 

The Panel ranked the deals/ individuals on the following criteria:

 

Deal of the Year and BEE Deal of the Year:

• Transformational transaction – does the deal or transaction transform the business or even the industry in which it operates? What is the extent of potential transformation as a result?

• Execution complexity – does the overall deal or transaction involve multiple steps/a number of smaller inter-related deals? Are there numerous conditions precedent that need to be fulfilled? Does it involve many and/or complex regulatory approvals? Are there related debt/equity raising processes and how difficult are they to implement? Was there significant time pressure to conclude the deal/transaction? Did the deal/transaction exhibit innovative structuring?

• Deal size – not an overriding determinant but a significant factor.

• Potential value creation – to what extent could shareholders and other stakeholders benefit from the transaction over time?

 

Private Equity Deal of the Year:

• Asset with good private equity characteristics – cashflow generative business and able to service an appropriate level of debt? A business model that is resilient to competitor action and downturns in the economic cycle? Strong management team that is well aligned with shareholders and capable of managing a private equity balance sheet? Predictable capex requirements that can be appropriately funded?

• Deal size – is a factor to filter deals but plays a limited role for acquisitions. It does carry more weight for disposals.

• Potential/actual value creation – was the asset acquired at an attractive multiple? If the deal is a disposal, was it sold at an attractive price? What is the estimated times money back and/or internal rate of return?

 

There is limited information available in the public domain on the private equity deals, and even somewhat educated guesswork doesn’t provide all answers in all instances.