THE FINANCE GHOST: The JSE’s capital conundrum

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The JSE's turned into the place you don't go to raise capital - but two recent cash calls show that investors are ravenous for good assets, writes FinanceGhost.

Speak to executives at small- or even mid-cap JSE companies and they will all say that being listed doesn’t guarantee access to capital. This partially explains the strong and concerning trend of de-listings.

The situation is made worse by the dearth of new listings. Private companies that need capital are choosing to attract private equity investors rather than executing initial public offerings on the JSE. This is especially thanks to a new breed of investors in the market who’ve recognised that the traditional private equity model of a five- to seven-year holding period combined with an extraordinary amount of debt has been too daunting for many founders.

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