Outsiders, which include most Dis-Chem shareholders, are unlikely to ever know what happened in the first three weeks of July to persuade founder Ivan Saltzman to withdraw his nomination for election as a non-executive director of the health-care retailer.
Whatever was behind the decision, it was hailed as part of a successful succession strategy designed to address an age-old corporate challenge — replacing a founder family with professional management.
Comparisons to the Ackermans’ handling of the process at Pick n Pay are inevitable. Raymond and his wife, Wendy, Ackerman built a formidable retail operation almost from scratch. But their determination to hold onto control through a value-destroying pyramid structure and through insisting on key roles for family members contributed to the group’s current existential crisis (as did an inappropriately generous dividend policy).
Dis-Chem’s AGM notice, sent to shareholders on June 30, included a resolution to confirm Saltzman’s appointment as a non-executive director. But on July 24 Dis-Chem issued a Sens announcement saying he had resigned and that the AGM resolution would be scrapped.
It was the first unexpected move in an otherwise carefully orchestrated retirement plan. The official explanation was unsurprisingly bland. “Following careful consideration, Ivan believes that the timing is appropriate to facilitate board succession while allowing the company to continue building on its strong foundations.”
Three days earlier Saltzman’s son Saul, also up for election as a non-executive director, withdrew and resigned. All of the Saltzmans had exited Dis-Chem’s formal management structure.
During the AGM on July 31, chair Larry Nestadt said he thought the family had simply decided that, as they were no longer executives in the business, it was time to exit.
Hardly persuasive. But then, does it really matter whether the 76-year-old Saltzman was pushed or jumped? And it’s not as though he doesn’t have a lot to do — he has extensive property interests.
Dis-Chem has been linked with the Saltzman name since it was established 48 years ago by Ivan and his wife, Lynette. By the time it listed on the JSE in 2016, it had 103 stores and annual turnover of R15bn. Now, 10 years later, it has 358 stores, annual turnover of R42.8bn and a market cap of about R25bn, up from R16bn on listing.
The share price on the day of listing was R23.26. It is now trading at R29. So, not a very rewarding time for Dis-Chem shareholders. Mind you, the 10 years have covered an extremely tough trading period, and after all, it is relative.
As Protea Capital Management’s Jean Pierre Verster points out, over the past 12 months Dis-Chem has dropped 13%, which looks grim until you consider that Clicks is down 43% over the same period. Indeed, it turns out that a 13% drop makes Dis-Chem one of the best performers in the retail sector this year.
But back to the family’s withdrawal plan, which arguably started back in 2016 when the Saltzmans sold 27.5% to the public. In 2023 Saltzman handed over the CEO reins to the CFO, Rui Morais. Precisely how much operational difference this made is unclear as Saltzman immediately assumed the role of executive chair, a position he held until June this year. But there have been signs of a subtle yet significant change in the group’s direction, away from being a traditional retailer to a broader health-care offering.
Perhaps more significant in terms of control are the Saltzmans’ share disposals. In January 2024 Ivan and Lynette sold a 6% stake to Coronation Fund Managers in a move that lifted Coronation’s stake to 29.8% and, coincidentally or not, reduced the Saltzmans’ to 29%.
Then in June 2025 Ivan and Lynette gifted a combined 25% stake to two of their sons, Dan and Mark, who live outside the country, leaving the founders with a stake of just 4%. The two sons subsequently sold some of the shares; the family now have a combined 27.68%. Coincidentally again, this stacks up against Coronation’s holding, as of end-February, of 26.8%.
Of course, the Saltzmans may have held onto the large and strategic stake not because they didn’t want to exit but because a sale would have exerted considerable pressure on the share price.
However, as things stand, either party is in a position to block special resolutions and hamper the rollout of strategic growth plans they happen not to like.
In any kind of showdown, it’s likely, given the long relationship, that director Stan Goetsch would back the Saltzmans with his 3.48% stake. Likely but not inevitable.
An alternative and more upbeat way of looking at the key shareholdings is that the hugely experienced Saltzman family remain in a position to exercise some influence on management as it develops a new strategy. Precisely how that influence is exercised is another matter.
While a showdown is unlikely, the significant change in growth strategy could cause tensions between the two blocks of major shareholders.
Sean Culverwell, investment analyst at Anchor, reckons the Saltzmans’ exit is ultimately positive for Dis-Chem and thinks Morais was the right choice to lead the business into its next phase. “The bigger question … is not the transition away from the founders but rather the strategy being pursued under the new leadership. The pivot into diversified financial services and other adjacent businesses carries meaningful execution risk. Dis-Chem has already committed significant capital to these initiatives and is likely to continue doing so as they scale. We are struggling to decide whether those businesses can ultimately generate returns that justify the investment.”
So, given the balance of shareholder power, perhaps it does matter whether Saltzman was pushed or jumped back in July.
But right now, it’s not entirely clear if the Saltzmans have exited Dis-Chem. The likelihood of a successful succession is strong, but it might become clear only over the next 12 to 18 months.
