South African companies are again looking beyond Africa to escape low-growth prospects brought on by the commodity price slump. Retailers, listed property companies, financial-services players and large industrials all seem to be joining the trend to find higher-yielding assets in markets not reliant on commodities.Two South African chief executives this week spoke about their moves into other territories in a panel discussion at the Sanlam i3 investment conference in Sandton.Patrice Rassou, head of equities at Sanlam Investments and the discussion facilitator, said there was a common thread of inventiveness in recent strategy from Mediclinic International's Danie Meintjies and Barloworld's Clive Thomson.story_article_left1"Mediclinic has capitalised on expansion opportunities offshore and diversified its earnings stream geographically; the difference is that they have raised their exposure to the Middle East."Barloworld found it tough in some African regions, with mining companies scaling back on capital expenditure," Rassou said. He also said some South African companies had found the going tough in Africa in terms of repatriating profits, coping with policy differences and dealing with stalling economic growth on the continent. Growth further afield would weed the strong business models from the weak.To escape expected slow organic growth and a competitive market in South Africa in which further significant acquisitions for Mediclinic would likely be impossible thanks to the competition authorities, Meintjies said, the hospital and clinic operator had dipped its toes into the waters of the Middle East and found it favourable.With about 100 clinics and hospitals, 10,000 beds and 35,000 employees spread across South Africa, the United Arab Emirates, Switzerland and the UK, various factors were at play in driving future returns outside of its home turf, Meintjies said.Chief among these were an investment-friendly regulatory environment in the UAE, with the creation of free zones allowing Mediclinic to own its land and properties, an ageing population in Europe and the UK, and the development of new medical technology that could open up new revenue streams.Beginning with a 49% share of one hospital in the UAE in 2006, Meintjies said, Mediclinic quickly grew to become the dominant healthcare player in Dubai.block_quotes_start We are still only a 'two out of 10' in terms of meeting our long-term potential in Russia block_quotes_endSeeing an opportunity to more than double its regional business in a merger with the Al Noor Hospitals Group, Mediclinic also became the largest player in Abu Dhabi.This came with an added bonus of Al Noor's existing listing on the London Stock Exchange. Since the middle of February, Meintjies said, this had provided access to cheap capital in a new market in pounds sterling - not nearly as volatile as the rand."The UAE has one of the world's fastest-growing populations and is seen as a safe haven. The industry is growing and government support has given us a good platform. The Middle East now provides a quarter of Mediclinic's pretax earnings."Vestact's Sasha Naryshkine said Mediclinic's expansion to the Middle East and particularly to Switzerland and the UK had been a "stroke of genius", even though operating in Europe alongside functioning national health schemes meant focusing on the high-end medical procedure market.mini_story_image_hright1"They're doing exactly the right thing," Naryshkine said. Mediclinic's high-margin European business was treating some of the wealthiest populations in the world. The company owned a 30% stake in Spire in the UK, and owned subsidiary Hirslanden in Switzerland outright. Naryshkine added that Mediclinic would have enough firepower to maintain an acquisitive strategy with a London listing and Remgro as an anchor shareholder.Thomson has been at the helm of one of South Africa's oldest listed companies for a decade and has overseen an expansion into 11 African countries, but also into Europe and the Russian Far East.The company sells Caterpillar equipment to miners and Thomson said the impact of the commodity slowdown had been ameliorated by splitting revenue between new sales and after-sales parts and maintenance contracts.New mining equipment sales rose sharply from 2000 to 2008, but dropped back by 65% in the first 18 months of the global financial crisis, then rose again above 2008 levels.Thomson expected mining companies to continue to cut costs, pay down debt and avoid capital expenditure on new projects. "The resilience of the business model is in diversity, where more than 50% of revenue is driven by parts and maintenance contracts. That's a counterweight to the cyclicality of commodity prices."Barloworld has put down roots in Siberia, where Thomson said operating conditions were extreme, but the company could charge a premium for executing properly for clients."Ships can only bring equipment in summer months, with unfrozen seas, and then we have to wait for winter to drag it across the ice."story_article_left2He said Russia's riches of gold, nickel, coal and diamond deposits meant that logistics infrastructure that could connect reserves and mines with ports may not exist; as it gets built, Barloworld would be poised to benefit in a long-term play."We started there in 1998 and now we have 1,000 people, make half a billion dollars in revenue and $40-million in operating profit last year. The business is at a reasonable scale, but I'd say we are still only a 'two out of 10' in terms of meeting our long-term potential in Russia."Barloworld's share of the southern African mining equipment market is nearly 60% and in Russia just 8%, but Thomson estimates these regions could feature business units of equal size in 15 years.Naryshkine said he had preferred Bidvest because of its diversification and that the commodity market on which Barloworld partly depended for business had an uncertain near future. This affected Barloworld's ability to expand. "When? That's the question. Things look tight and look likely to be tight for some time."When things turn, Barloworld may be an obvious beneficiary, and it is trading at what are historically discounted multiples. It could get a rerating if South Africa's picture improves. If you have a positive view on South Africa, it could be a good business to own."peacockb@sundaytimes.co.za..