It is difficult not to have a sense of patriotic pride when seeing SA companies in league tables of the world's biggest companies, though it is irritating to see them named British or Australian rather than South African.
The strong rand has done much to help some SA companies when compared with their global peers. But still only four companies on the SA Giants list can be found on lists of the world's largest companies. Two - BHP Billiton and Anglo American - make it on to both the Fortune 500 and the Financial Times 500. Old Mutual is included in the Fortune list and the FT 500 includes SABMiller.
The Fortune 500 uses a broadly similar methodology to the SA Giants, basing its ranking on revenue (the FT 500 uses market cap). Anglo American was ranked at 275 in last year's Fortune 500, Old Mutual at 304, and BHP Billiton at 341. The first two, though, were listed as British because they are now London headquartered, and the last as Australian (BHP Billiton has a dual UK/Australian head office).
Different accounting standards and publication dates make the global list numbers different to ours. SA Giants shows that Old Mutual is likely to find itself knocked out of the Fortune 500 completely, after a dismal year driven by problems in Nedcor. The inevitable timing mismatches mean that though some turnaround at Nedcor is evident, it will be a while before that translates into improved global rankings for its mother company. On the SA Giants list, Old Mutual has slipped to fifth, behind the highest fully SA company, Sasol, and SABMiller, another London-domiciled business.
The FT 500 shows a different picture because it is based on market cap - perhaps a more forward-looking measure than revenue alone. BHP Billiton ranks 71st and Anglo 148th. Old Mutual is off the list and SABMiller creeps in at 494th.
The bottom company of the Fortune 500 last year made it with revenue of US$10,827bn. Presuming the bar doesn't move too far up, SABMiller looks set to make it onto the global list this year, with revenue of more than $11bn (as reported in the SA Giants table). Sasol, though, will fall $1bn short.
SA companies have scaled the global league tables as a result of acquisitions, something that would not have happened without foreign listings. Old Mutual has made big acquisitions since it established its primary listing in London in 1999 after demutualisation, as has Anglo American and particularly BHP Billiton, which led the way in internationalising after 1994. If SABMiller makes it onto the global Fortune 500, it will be mainly thanks to its acquisition of US brewer Miller. Acquisitions, rather than organic growth, is the quickest way SA companies will move up the size rankings. But acquisitions make no sense when made just for their own sake. Old Mutual has battled to bed down the rash of acquisitions it made shortly after listing. Only SABMiller has managed, as far as can be seen, to consistently make value-enhancing acquisitions. So if the presence of SA firms on global lists is to be a source of national pride, let it rather be about performance than size.
