Dis-Chem dynasty dynamics

SUCCESSION LEGACY: WILL THE PHARMACY EMPIRE RETAIN ITS ENTREPRENEURIAL EDGE?

- Prinesha Naidoo, Janice Kew and Alexander Sazonov

“Does the price of medicine make you sick?”

That's the tag line of an ’80s advertisement that helped propel a mom-and-pop discount pharmacy into one of South Africa’s biggest listed drugstore chains.

Now, Dis-Chem Pharmacies faces a new test: founder Ivan Saltzman, 76, who built the business from one Johannesburg store to a $1.7 billion (about R27.9 billion) health care chain spanning three countries, retires as chair of the board this month.

The move reduces Saltzman’s direct involvement in the company and raises questions about whether the entrepreneurial culture that built the firm can retain its edge under Rui Morais, a company insider who worked on its listing and was appointed chief executive about three years ago.

More broadly, it spotlights the beginnings of a generational transfer of wealth in South Africa as more than 40% of the country’s high-net-worth individuals are older than 60 and expected to pass on about $85 billion over the next decade, according to data based on Henley & Partners’ Africa Wealth Report.

The Saltzman family has a fortune of $1.3 billion (about R21.3 billion), according to the Bloomberg Billionaires Index. Saltzman and his wife, Lynette - pharmacists who built Dis-Chem together - gifted two of their sons shares before his retirement, ensuring the family still holds more than a quarter of the firm.