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A dealmaker who cuts his coat to fit his styleRAJEN PILLAY
RAJEN Pillay, managing director of Durban-based textile maker Coastal Group, likes to keep his options open. In fact, he is reluctant to look 10 years ahead. "But I am sure I won't be doing the same thing. I don't ever want to become corporate deadwood." He could complete his degree in chemistry, go back to stockbroking - or chill out and become a lifesaver. But for the record he says he has no plans to leave his job. Making waves is nothing new to Pillay, who has hit headlines with a hostile takeover bid of the Durban clothing maker AM Moolla Group. He has never chosen to walk the beaten path. He grew up in Verulam, north of Durban, and went to the UK as a teenager. There he completed his O and A levels, and began working towards a degree in chemistry. Pillay came back to SA at the request of his father and completed a BCom Honours at Natal University. He started doing his articles at Deloittes but "I could never have made it as an auditor". Pillay had an excellent role model - his father, Pakkiri Pakkiry Pillay, founder and chairman of food group Pakco. "My father was a pioneering industrialist in Durban in the dark days when black business struggled to get anywhere."
Rather than step into the family business - the easy option - Pillay set his heart on stockbroking, certainly not the done thing for a black person at that time. But he confounded the odds and became Natal's first black stockbroker. He joined stockbroking firm Frankel Pollak in 1990 and worked his way up to become a director.
By the early '90s, Pillay was ready for new challenges. He approached Indonesian textile group Texmaco to set up business in SA. That he chose textiles, "an industry with a poor reputation", and an Asian partner "in a Eurocentric country", again drew disdain. Receiving a favourable response from Texmaco, Pillay resigned from Frankel Pollak. But, thrown off track by the 1994 elections and investor uncertainty, Texmaco delayed its move for an agonising 18 months. It was worth the wait. The Coastal Group was listed on the JSE with a share price of 30c in April 1995. Today its price is just under R11. That growth saw the Financial Mail this year, in its annual survey of all JSE companies, rating Coastal as No 4 in capital appreciation.
Today, Coastal, with assets of R400-million, is testing new ground for growth. Now coming on stream in Coastal's $28.5-million acquisition of deNim Textiles is an expansion plan which will see its Hammarsdale factory increase production to 1.8-million metres a month from the current 1.1-million metres. Also in Hammarsdale, a polyester operation is about to get going which will produce 3-million metres a month. On the cards is an $8-million investment in 10 000mē of factory space in Prospecton for a twisting project - weaving imported yarn into fabric. Coastal's factory in Botswana will produce 6-million garments a year, all for export. "That's where AM Moolla, as a clothing maker, comes in," Pillay says. "If we can combine our skills and resources, we can accelerate the process by two years." Which brings us back to AM Moolla. Pillay scoffs at talk of the takeover bid being hostile. "From our side, there is nothing hostile about it. Unsolicited, yes. If we wanted to be hostile, we could have quietly bought AM Moolla shares through nominees on the market." On October 20, Coastal made a R111-million offer to acquire AM Moolla. It offered shareholders the option of 16 Coastal ordinary shares or 14 cumulative preference shares for every 100 AM Moola shares. AM Moolla said on Friday it had written udertakings from the holders of more than 50% of the company's issued share capital - including their own holdings - not to accept the offer. AMM chairman Sadek Vahed termed the offer "unsolicited and totally inadequate".
Janette Bennett Top of page
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