Finance Minister provides details about the government’s deal to buy South Africa’s largest housing developer

Finance Minister Enoch Godongwana provided details about the Public Investment Corporation’s (PIC’s) deal to buy a major stake in Balwin Properties.

Balwin Properties is South Africa’s largest housing developer, building 3,000 houses a year, mostly in the affordable segment of the market.

The company was founded in 1996 by CEO Steve Brookes and Rodney Grey and was listed on the Johannesburg Stock Exchange in 2015.

It specialises in developing large-scale, sectional-title estates in Gauteng, the Western Cape, and KwaZulu-Natal.

Balwin has seen significant operational and physical growth, with its total assets increasing from R1.48 billion in 2015 to R8.3 billion in 2026.

However, its share price did not track this growth. Instead, it decreased from R10.25 on debut in 2015 to R3.12 in April 2026.

A consortium backed by PIC, Brookes and Grey felt it provided a takeover and delisting opportunity.

They said Balwin was trading at a discount, had poor liquidity, and offered a good exit price, which could unlock value to all stakeholders.

The consortium established a new company, BidCo, wholly owned by Volker Holdings, which is controlled by Brookes, to implement the proposed transaction.

Godongwana said that, following the transaction, BidCo will own 100% of Balwin Properties and will be jointly owned by a consortium of investors.

The PIC, South Africa’s largest asset manager wholly owned by the government, paid R1.12  billion for a 49.10% interest in BidCo

“The investment was made at R4.35 per share, implying a listed company valuation of R2.26 billion,” Godongwana said.

“It is important to note that the investment was made at a discount of 49% to the PIC’s independent net asset value of R8.46 per share.”

He added that it was also at a 55% discount to Balwin’s reported International Financial Reporting Standards (IFRS) net asset value of R9.77 per share.

Balwin Properties will delist from the JSE and A2X on 20 October 2026, subject to final conditions of the deal.

This will bring an end to the company’s 11-year tenure on the Johannesburg Stock Exchange and mark the start of a new chapter as a private company.

Independent valuations of Balwin Properties

The PIC has previously been blamed for overpaying for assets due to poor valuations, but Godongwana said this was not the case with Balwin.

He said that an independent valuation was obtained for the PIC’s benefit as part of the investment’s due diligence workstream, which valued Balwin at R8.46 per share.

“A fair and reasonable opinion was obtained by Balwin’s Independent Board for its benefit from Valeo Capital to assess the PIC’s offer price of R4.35/share,” he said.

“Valeo concluded that the offer price was fair and reasonable to Balwin shareholders, which resulted in the deal being done.”

The investment was approved by the PIC’s Group Management Investment Committee (GMIC) on 15 August 2025.

“The final offer price of R4.35 per share was approved by the Investment Committee on 29 April 2026,” Godongwana said.

He added that the investment in Balwin was made in accordance with the reviewed governance processes and structures.

These were implemented after the Commission of Inquiry into allegations of impropriety regarding the Public Investment Corporation, known as the Mpati Commission.

It included the revised Unlisted Investments Delegation of Authority (DoA), which incorporates the approved operating model and new organisational structure.

Godongwana said that the investment in Balwin forms part of the Government Employees Pension Fund (GEPF) portfolio.

The PIC will report on the performance of this investment in its quarterly reports, as required by the investment management agreement.