<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of M)C))
(Amendment No. __)
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
The Southern Africa Fund, Inc.
- ----------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- ----------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement,
if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X / No fee required
/ / Fee computed on table below per Exchange Act Rule 14a-
6(i)(1) and 0-11.
(1) Title of each class of securities to which
transaction applies:
- ----------------------------------------------------------------
(2) Aggregate number of securities to which transaction
applies:
- ----------------------------------------------------------------
(3) Per unit price or other underlying value of
transaction computed pursuant to Exchange Act Rule 0-11
(Set forth the amount on which the filing fee is
calculated and state how it was determined):
- ----------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- ----------------------------------------------------------------
(5) Total fee paid:
- ----------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided
by Exchange Act Rule 0-11(a)(2) and identify the filing
for which the offsetting fee was paid previously.
Identify the previous filing by registration statement
<PAGE>
number, or the Form or Schedule and the date of its
filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
2
<PAGE>
THE SOUTHERN AFRICA FUND, INC.
1345 Avenue of the Americas
New York, New York 10105
Toll Free (800) 221-5672
March 12, 1999
To the Stockholders of The Southern Africa Fund, Inc. (the
"Fund"):
The accompanying Notice of Meeting and Proxy Statement
present proposals to be considered at the Fund's Annual Meeting
of Stockholders on April 27, 1999.
The Board of Directors recommends that you re-elect to the
Board the five current Directors who are standing for re-election
(Proposal 1) and ratify the Board's selection of Ernst & Young
LLP as the Fund's independent auditors for its 1999 fiscal year
(Proposal 2).
The Notice and Proxy Statement also include four proposals
(Proposals 3, 4, 5 and 6) which the Fund understands two
affiliated stockholders intend to present at the Annual Meeting.
Three of these proposals are recommendations for action by the
Board of Directors. The fourth (Proposal 5) seeks to remove
Alliance Capital Management L.P. ("Alliance") as the Fund's
Investment Manager. This proposal would sever the Fund's
relationship with Alliance, thus disrupting the Fund's investment
program and creating a period of uncertainty which could
substantially harm your investment. For the reasons indicated in
the Proxy Statement, your Board of Directors unanimously urges
you to vote against each of these four proposals.
We welcome your attendance at the Annual Meeting. If you are
unable to attend, we encourage you to vote your proxy promptly,
in order to spare the Fund additional proxy solicitation
expenses. Shareholder Communications Corporation ("SCC"), a
professional proxy solicitation firm, has been selected to assist
stockholders in the voting process. As the date of the Meeting
approaches, if we have not yet received your proxy, you may
receive a telephone call from SCC reminding you to exercise your
right to vote. If you have any questions regarding the Meeting
agenda or how to give your proxy, please call SCC at (800) 733-
8481 ext. 483.
Sincerely,
Dave H. Williams
Chairman and President
3
<PAGE>
The Southern Africa Fund, Inc.
____________________________________
Alliance Capital [Logo]
Alliance Capital Management L.P.
____________________________________
NOTICE OF ANNUAL MEETING
OF STOCKHOLDERS AND
PROXY STATEMENT
March 12, 1999
4
<PAGE>
Alliance Capital [Logo] The Southern Africa Fund, Inc.
________________________________________________________________
1345 Avenue of the Americas, New York, New York 10105
Toll Free (800)221-5672
________________________________________________________________
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
April 27, 1999
To the Stockholders of The Southern Africa Fund, Inc.:
Notice is hereby given that the Annual Meeting of
Stockholders (the "Meeting") of The Southern Africa Fund, Inc., a
Maryland corporation (the "Fund"), will be held at the offices of
the Fund, 1345 Avenue of the Americas, 41st Floor, New York, New
York, on Tuesday, April 27, 1999 at 11:00 a.m., for the following
purposes, all of which are more fully described in the
accompanying Proxy Statement dated March 12, 1999:
1. To elect five Directors of the Fund, four to hold office
for a term of three years and one to hold office for a term of
two years, and each until his or her successor is duly elected
and qualifies;
2. To ratify the selection of Ernst & Young LLP as
independent auditors of the Fund for its fiscal year ending
November 30, 1999;
3. To act upon, if presented, certain stockholder
proposals; and
4. To transact such other business as may properly come
before the Meeting.
The Board of Directors has fixed the close of business on
January 29, 1999 as the record date for the determination of
stockholders entitled to notice of, and to vote at, the Meeting
or any postponement or adjournment thereof. The enclosed proxy
is being solicited on behalf of the Board of Directors.
By order of the Board of Directors,
Edmund P. Bergan, Jr.
Secretary
New York, New York
March 12, 1999
5
<PAGE>
_______________________________________________________________
YOUR VOTE IS IMPORTANT
Please indicate your voting instructions on the enclosed
proxy card, sign and date it, and return it in the envelope
provided, which needs no postage if mailed in the United States.
Your vote is very important no matter how many shares you own.
Please mark and mail your proxy promptly in order to save the
Fund any additional expense of further proxy solicitation and in
order for the Meeting to be held as scheduled.
________________________________________________________________
(R) This registered service mark used under license from the
owner, Alliance Capital Management L.P.
6
<PAGE>
PROXY STATEMENT
THE SOUTHERN AFRICA FUND, INC.
1345 Avenue of the Americas
New York, New York 10105
___________________
ANNUAL MEETING OF STOCKHOLDERS
April 27, 1999
___________________
INTRODUCTION
This Proxy Statement is furnished in connection with the
solicitation of proxies on behalf of the Board of Directors of
The Southern Africa Fund, Inc., a Maryland corporation (the
"Fund"), to be voted at the Annual Meeting of Stockholders of the
Fund (the "Meeting") to be held at the offices of the Fund, 1345
Avenue of the Americas, 41st Floor, New York, New York, on
Tuesday, April 27, 1999 at 11:00 a.m. The solicitation will be
by mail and the cost will be borne by the Fund. The Notice for
this Meeting, this Proxy Statement and the accompanying Proxy
Card are being mailed to stockholders on or about March 12, 1999.
The Board of Directors has fixed the close of business
on January 29, 1999 as the record date for the determination of
stockholders entitled to notice of, and to vote at, the Meeting
and at any postponement or adjournment thereof. The outstanding
voting shares of the Fund as of January 29, 1999 consisted of
6,007,100 shares of common stock, each share being entitled to
one vote. All properly executed and timely received proxies will
be voted in accordance with the instructions marked thereon or
otherwise provided therein. Accordingly, unless instructions to
the contrary are marked, proxies will be voted for the election
of five Directors (Proposal One), for the ratification of the
selection of Ernst & Young LLP as the Fund's independent auditors
for its fiscal year ending November 30, 1999 (Proposal Two) and
against each of the stockholder proposals (Proposals Three
through Six). Any stockholder may revoke that stockholder's
proxy at any time prior to exercise thereof by giving written
notice to the Secretary of the Fund at 1345 Avenue of the
Americas, New York, New York 10105, by signing another proxy of a
later date or by personally voting at the Meeting.
If a proxy properly executed is returned with
instructions to abstain from voting or to withhold authority to
vote (an abstention) or represents a broker "non-vote" (that is,
a proxy from a broker or nominee indicating that such person has
not received instructions from the beneficial owner or other
1
<PAGE>
person entitled to vote shares on a particular matter with
respect to which the broker or nominee does not have
discretionary power to vote), the shares represented by the
proxy, with respect to matters to be determined by a plurality or
majority of the votes cast on such matters (i.e., Proposals One
through Four and Six), will be considered present for purposes of
determining the existence of a quorum for the transaction of
business but, not being cast, will have no effect on the outcome
of such matters. With respect to Proposal Five, the adoption of
which requires the affirmative vote of a specified proportion of
Fund shares, an abstention or broker non-vote will be considered
present for purposes of determining the existence of a quorum but
will have the effect of a vote against Proposal Five. If any
proposals, other than Proposals One through Six, properly come
before the Meeting, the shares represented by proxies will be
voted on all such proposals in the discretion of the person or
persons voting the proxies.
A quorum for the Meeting will consist of a majority of
the shares outstanding. In the event that a quorum is not
represented at the Meeting or, even if a quorum is represented,
in the event that sufficient votes in favor of the position
recommended by the Board of Directors on any proposal described
in the Proxy Statement are not received prior to the Meeting, the
persons named as proxies may, but are under no obligation to,
with no other notice than announcement at the Meeting, propose
and vote for one or more adjournments of the Meeting in order to
permit further solicitation of proxies with respect to such
proposal. The Meeting may be adjourned with respect to fewer
than all of the proposals in the Proxy Statement, and a
stockholder vote may be taken on any one or more of the proposals
prior to any adjournment if sufficient votes have been received
for approval thereof. Shares represented by proxies indicating a
vote contrary to the position recommended by the Board of
Directors on a proposal will be voted against adjournment as to
that proposal.
The Fund has engaged Shareholder Communications
Corporation ("SCC"), 17 State Street, New York, New York 10004,
to assist the Fund in soliciting proxies for the Meeting. SCC
will receive a fee of $75,000 for its services plus reimbursement
of out-of-pocket expenses.
PROPOSAL ONE
ELECTION OF DIRECTORS
At the Meeting, five Directors of the Fund will be
elected, four to hold office for a term of three years and one to
hold office for a term of two years, and each of them until his
or her successor is duly elected and qualifies. The affirmative
2
<PAGE>
vote of a plurality of the votes cast at the Meeting is required
to elect a Director. It is the intention of the persons named as
proxies in the accompanying proxy to nominate and vote in favor
of the election of each nominee referred to below.
Pursuant to the charter and By-laws of the Fund, the
Board of Directors has been divided into three classes. The
terms of office of the members of Class One will expire as of the
Meeting, those of Class Two will expire as of the next annual
meeting of stockholders, and those of Class Three will expire as
of the annual meeting of stockholders for the year 2001. Upon
expiration of the terms of office of the members of a class as
set forth above, those persons then elected as Directors in that
class serve until the third annual meeting of stockholders
following their election and until their successors are duly
elected and qualify. Mr. Dave H. Williams, Prof. Dennis Davis,
Ms. Wendy N. Luhabe and Mr. Sam N. Montsi are currently members
of Class One; Dr. Willem de Klerk and Messrs. Moss L. Leoka,
Ronnie Masson, Frank Savage and Peter G.A. Wrighton are currently
members of Class Two; and Dr. Reba W. Williams and Messrs. T.N.
Chapman, David D.T. Hatendi and Johannes C. van Reenen are
currently members of Class Three.
Under this class structure, only those Directors in a
single class may be changed in any one year, and it would require
two years to change a majority of the Board of Directors
(although under Maryland law, procedures are available for the
removal of Directors even if they are not then standing for
reelection and, under regulations of the Securities and Exchange
Commission (the "Commission"), procedures are available for
including appropriate stockholder proposals in the Fund's annual
proxy statement). This system of electing Directors, which may
be regarded as an "anti-takeover" provision, may make it more
difficult for the Fund's stockholders to change the majority of
Directors and, thus, have the effect of maintaining the
continuity and stability of management.
At a meeting of the Board of Directors held on July 23,
1998, Ms. Luhabe and Mr. Montsi were elected to fill vacancies on
the Board of Directors until the Meeting. At a meeting of the
Board of Directors held on October 9, 1998, Mr. Williams, Prof.
Davis, Ms. Luhabe and Mr. Montsi were each nominated as Directors
in Class One for election at the Meeting. At the Meeting, each
of them is to be elected to serve for a term of three years and
until their successors are duly elected and qualify. At a
meeting of the Board of Directors held on October 9, 1998, Mr.
van Reenen was elected to fill a vacancy on the Board of
Directors until the Meeting and was nominated as a Director in
Class Three for election at the Meeting. At the Meeting, Mr. van
Reenen is to be elected to serve for a term of two years and
until his successor is duly elected and qualifies. Each of the
3
<PAGE>
five nominees has consented to serve as a Director. The Board of
Directors knows of no reason why any of the nominees will be
unable to serve, but in the event of such inability, the proxies
received will be voted for a substitute nominee as the Board of
Directors may recommend.
Although the Fund is a Maryland corporation, certain of
its Directors and officers are not residents of the United
States, and substantially all of the assets of such persons may
be located outside of the United States. As a result, it may be
difficult for United States investors to effect service of
process upon such Directors or officers within the United States
or to realize judgments of courts of the United States predicated
upon civil liabilities of such Directors or officers under the
federal securities laws of the United States.
Certain information concerning the Fund's Directors and
nominees for election as Directors is set forth below. Mr. Dave
H. Williams and Dr. Reba W. Williams are each a director or
trustee of one or more other investment companies sponsored by
Alliance Capital Management L.P., the Fund's investment adviser
("Alliance").
4
<PAGE>
Year Number of shares
Name, age, positions and offices Year term beneficially
with the Fund, principal first as owned directly
occupations during the past became Director or indirectly
five years and other a will as of
Directorships Director expire March 12, 1999
______________________________ ________ ________ _______________
* Dave H. Williams, Chairman, 1994 2002+ 10,000
66. Chairman of the Board (Class One)
of Alliance Capital
Management Corporation
("ACMC")** since prior to
1994; Director of The
Equitable Companies
Incorporated and the
Equitable Life Assurance
Society of the United
States.....................
++ T.N. Chapman, Director, 64. 1994 2001 925
Chairman of Airports Co. (Class Three)
Limited; Chairman of First
National Bank of Southern
Africa Limited; Director of
Oceana Fishing Group
Limited and National
Business Initiative;
formerly Chairman of The
Southern Life Association
Limited....................
++ Prof. Dennis Davis, 1994 2002+ 0
Director, 48. Judge of the (Class One)
High Court of South Africa;
Professor of Law at the
University of Cape Town;
formerly Director of The
Centre for Applied Legal
Studies, University of the
Witwatersrand..............
++ David D.T. Hatendi, 1994 2001 0
Director, 45. Managing (Class Three)
Director of Merchant Bank
of Central Africa Limited;
Director of Old Mutual
(Zimbabwe).................
5
<PAGE>
++ Dr. Willem de Klerk, 1994 2002 470
Director, 70. Emeritus (Class Two)
Professor of Journalism and
Political Communications;
independent political
consultant.................
* Moss L. Leoka, Director, 1994 2000 0
48. Managing Director of (Class Two)
Moss Leoka Communications;
Chief Executive Officer of
Alliance-Odyssey Capital
Management (Pty) Ltd.
(South Africa); Director of
Cadbury S.A. (Pty) Ltd.,
Regional Resources Ltd.,
Airports Company Limited,
Platgold Minerals Ltd.,
Vincemus Investments Ltd.
and Promat College of
Education..................
* Wendy N. Luhabe, Director, 1998 2002+ 0
41. Managing Partner of (Class One)
Bridging the Gap (human
resources consulting) and
Executive Chairman of
Alliance-Odyssey Capital
Management (Pty) Ltd.
(asset management);
Director of Tiger Oats
(food), Women Investment
Portfolio Holdings
(WIPHOLD) (investments),
Telkom (telecommunica-
tions), Prosperity Holdings
(finance), IDC (industrial
developments) and Cycod
Financial Holdings
(finance)..................
+++ Ronnie Masson, Director, 1994 2002 0
62. Formerly Senior General (Class Two)
Manager-Investments, Gensec
Asset Management (Pty)
Ltd.; Director of Genbel,
Gensec, Gensec Asset
Management, Gensec Bank and
Gensec Properties..........
6
<PAGE>
++ Sam N. Montsi, Director, 1998 2000 100
54. Founder and Chief (Class Two)
Executive of Montsi and
Associates CC (business and
project consulting);
founder and Chairman of
Siphumelele Investments
Limited (investments);
Director of Independent
Newspaper Holdings Limited,
Johnnies Industrial
Corporation Limited, Sasol
Limited, Southern Life
Association, Equisec (Pty)
Ltd., Fabcos Investment
Company, Northern
Engineering Industries
Africa Limited, Business
and Arts South Africa, PSG
Group Ltd. and Primovie
Management (Pty) Ltd.;
Chairman of Thaba Strategic
Services (Pty) Ltd., Montsi
Properties (Pty) Ltd.,
Surmon Fishing (Pty) Ltd.
and Diva Nutritional
Products (Pty) Ltd.........
+++ Johannes C. van Reenen, 44. 1998 2001+ 0
Managing Director of Gensec (Class Three)
Asset Management (Pty)
Ltd.; Executive Director of
Genbel Securities Limited;
formerly Manager of Genbel
Limited and Executive
Director of Genbel
Securities Limited;
Director of The Business
Bank Limited (merchant
banking), RTT Limited
(transportation), Gensec
Capital Assets (Pty)
Limited, Pirtoge Property
Investment (Pty) Limited
and Gensec International
Asset Management Ltd.......
7
<PAGE>
* Frank Savage, Director, 60 1994 2000 850
Director of ACMC; Chairman (Class Two)
of Alliance Capital
Management International
and Alliance Corporate
Finance Group Incorporated;
Director of Essence
Communications, Lockheed
Martin Corporation,
QUALCOMM Incorporated and
Lyondell Chemical Company;
formerly Chairman of
Equitable Capital
Management Corporation.....
* Dr. Reba W. Williams, 1994 2001 10,000
Director, 62. Director of (Class Three)
ACMC; Director of Special
Projects, ACMC; art
historian and writer;
formerly Vice President and
security analyst for
Mitchell-Hutchins, Inc. and
an analyst for McKinsey &
Company, Inc...............
++ Peter G.A. Wrighton, 1994 2000 1,140
Director, 64. Chairman of (Class Two)
Elephant Pass Wine Company
(Pty) Ltd. and Africa
Resources Limited; Director
of Consolidated Frame
Textiles Ltd., Frame Group
Holdings Ltd., The SA
Institute of Business
Ethics (Pty) Ltd. and
Capestar Growth Investments
Ltd.; formerly Chairman and
Chief Executive of The
Premier Group and Director
of Liberty Holdings Ltd.,
Liberty Life Association of
Africa Ltd. and Liblife
Strategic Investments Ltd.
_________________
* "Interested person," as defined in the Investment Company Act of 1940, as
amended (the "Act"), of the Fund because of affiliation with Alliance.
** or purposes of this Proxy Statement, ACMC refers to Alliance Capital
Management Corporation, the sole general partner of Alliance.
+ If elected at the Meeting.
8
<PAGE>
++ Member of the Audit Committee and the Nominating Committee.
+++ "Interested person," as defined in the Act, of the Fund because of
affiliation with Gensec Asset Management (Pty) Ltd., the Fund's sub-
adviser ("Gensec").
9
<PAGE>
Alliance has instituted a policy applicable to all of
the investment companies to which Alliance provides investment
advisory services (collectively, the "Alliance Fund Complex")
contemplating, in the case of the Fund, that the Directors of the
Fund will each invest at least $10,000 in shares of the Fund. In
the case of the Fund, there are practical difficulties relating
to the current exchange control restrictions in certain Southern
African countries which tend to inhibit residents of such
countries in engaging in transactions in Fund shares.
During the fiscal year ended November 30, 1998, the
Board of Directors met four times, the Audit Committee met two
times for the purposes described below in Proposal Two, and the
Nominating Committee met four times. The Nominating Committee
was constituted for the purpose of selecting and nominating
persons to fill any vacancies on the Board of Directors. The
Nominating Committee does not normally consider candidates
proposed by stockholders for election as Directors.
The Fund does not pay any fees to, or reimburse expenses
of, any Director during a time in which such Director is
considered an "interested person" of the Fund. The aggregate
compensation paid by the Fund to each of the Directors during its
fiscal year ended November 30, 1998, the aggregate compensation
paid to each of the Directors during the calendar year 1998 by
the Alliance Fund Complex and the total number of investment
companies and investment portfolios in the Alliance Fund Complex
with respect to which each of the Directors serves as a director
or trustee are set forth below. Neither the Fund nor any other
investment company in the Alliance Fund Complex provides
compensation in the form of pension or retirement benefits to any
of its directors or trustees.
10
<PAGE>
<TABLE>
Total Number of Total Number of
Investment Companies Investment Portfolios
Total Compensation from the Fund and the Alliance in the Alliance Fund
Aggregate Compensation the Fund and the Alliance Complex, Including the Complex, Including
from the Fund During Fund Complex, Including Fund, as to which the Fund, as to which the
the Fiscal Year ended the Fund, During the 1998 Director is a Director or the Director is a
Name of Director November 30, 1998 Calendar Year Trustee Director or Trustee
<S> <C> <C> <C> <C>
Dave H. Williams $ 0 $ 0 6 15
T.N. Chapman $10,000 $10,000 1 1
Prof. Dennis Davis $10,000 $10,000 1 1
David D.T. Hatendi $10,000 $10,000 1 1
Dr. Willem de Klerk $ 9,500 $ 9,500 1 1
Moss L. Leoka $ 0 $ 0 1 1
Wendy N. Luhabe $ 0 $ 0 1 1
Ronnie Masson $ 0 $ 0 1 1
Sam N. Montsi $ 2,500 $ 2,500 1 1
Johannes C. van Reenen $ 0 $ 0 1 1
Frank Savage $ 0 $ 0 1 1
Dr. Reba W. Williams $ 0 $ 0 3 3
Peter G.A. Wrighton $10,000 $10,000 1 1
</TABLE>
As of January 29, 1999, the Directors and officers of
the Fund as a group owned less than 1% of the shares of the Fund.
During the Fund's most recently completed fiscal year, none of
the Fund's Directors engaged in a purchase or sale of the
securities of Alliance or Gensec, or of any of their respective
parents or subsidiaries, in an amount exceeding 1% of the
relevant class of outstanding securities.
Your Board of Directors unanimously recommends that the
stockholders vote FOR the election of each of the foregoing
nominees to serve as a Director of the Fund.
PROPOSAL TWO
RATIFICATION OF SELECTION OF
INDEPENDENT AUDITORS
The Board of Directors, including a majority of the
Directors who are not "interested persons" of the Fund, as
defined in the Act, at a meeting held on October 9, 1998,
selected Ernst & Young LLP, independent accountants, to audit the
accounts of the Fund for the fiscal year ending November 30,
1999. Ernst & Young LLP has audited the accounts of the Fund
since the Fund's commencement of operations and does not have any
direct financial interest or any material indirect financial
11
<PAGE>
interest in the Fund. The affirmative vote of a majority of the
votes cast at the Meeting is required to ratify such selection.
A representative of Ernst & Young LLP is expected to
attend the Meeting and to have the opportunity to make a
statement and to respond to appropriate questions from the
stockholders. The Audit Committee of the Board of Directors
generally meets twice a year with representatives of Ernst &
Young LLP to discuss the scope of their engagement and review the
financial statements of the Fund and the results of their
examination thereof.
Your Board of Directors unanimously recommends that the
stockholders vote FOR the ratification of the selection of Ernst
& Young LLP as independent auditors of the Fund.
PROPOSAL THREE
STOCKHOLDER RECOMMENDATION REGARDING
NET ASSET VALUE REALIZATION
Two affiliated persons who assert that they are
beneficial owners of a total of less than 5% of the Fund's
outstanding shares (the "proponent") have informed the Fund that
they intend to present the following recommendation for action at
the Meeting. Adoption of this proposal requires the affirmative
vote of a majority of the votes cast thereon at the Meeting.
RESOLVED: That the stockholders hereby recommend that
the Board of Directors take whatever steps necessary to provide
all shareholders the option of receiving full Net Asset Value
(NAV) for their shares within two months (60 days) of the date of
the 1999 Annual Meeting.
Your Board of Directors unanimously opposes this proposal.
The Prospectus for the initial offering of the Fund's
shares in 1994 envisioned that the shares might trade at a
discount and provided for mandatory tender offers if the discount
exceeded a prescribed level. The first of these offers will
occur in the second quarter of this year. The Board of Directors
is concerned that sustained market discounts at the abnormally
high levels at which Fund shares traded during the emerging
market volatility in the third quarter of 1998 would not be in
the best interests of the Fund and its stockholders. To this
end, in October 1998, the Board of Directors adopted a program
for the repurchase of Fund shares which could, if advisable, be
commenced following conclusion of the tender offer.
The proponent's recommendation clearly contemplates
action intended by the proponent to lead to a substantial and
12
<PAGE>
rapid decrease in the Fund's assets, as the proponent and other
professional arbitrageurs, who have taken significant positions
in the Fund in the apparent hope of profiting from the measures
advocated by the proponent, rapidly exit the Fund. Only drastic
action, such as converting the Fund to open-end status or
permitting unlimited redemptions payable in cash or securities,
would conform to the proponent's resolution. The Board of
Directors strongly believes that such measures would prejudice
the interests of longer-term investors in the Fund. Such a
decrease in Fund assets would upset the Fund's investment
strategy, thus endangering the Fund's outstanding relative
performance, and would jeopardize the Fund's economic viability.
Alliance has advised the Board of Directors that
implementation of any of these measures could be expected to
result in a decrease in the Fund's assets on the order of 70%.
Because of the limited liquidity of the Southern African equity
markets, the divestiture of such a large portion of the Fund's
portfolio securities, as the result of any of the measures
advocated by the proponent, could be accomplished only with
substantial dilution of the shares held by remaining Fund
stockholders as the result of the market impact of such
liquidations. In addition, such asset shrinkage would
substantially increase the Fund's per-share expense ratio,
because many of the Fund's expenses are fixed and would be spread
over a substantially smaller asset base, proportionately
increasing their per-share effect. If the Fund's assets were to
decrease by 70%, it is estimated that the Fund's per-share
expense ratio would increase from its current annualized level of
2.1% of net assets to approximately 4.25%.
Notwithstanding the benefit to those stockholders who
desire to liquidate their shares in the short-term, the Board of
Directors strongly believes that, on balance, the measures
advocated by the proponent would be clearly contrary to the best
interests of the Fund and its stockholders generally.
Accordingly, the Board of Directors strongly opposes the
proponent's recommendation.
Your Board of Directors unanimously recommends that the
stockholders vote AGAINST Proposal Three.
PROPOSAL FOUR
STOCKHOLDER RECOMMENDATION FOR
RESIGNATION OF DIRECTORS
The proponent has informed the Fund that the proponent
also intends to present the following recommendation for action
at the Meeting. Adoption of this proposal requires the
13
<PAGE>
affirmative vote of a majority of the votes cast thereon at the
Meeting.
RESOLVED: That it would be in the best interests of the
Fund and its stockholders for all Directors not standing for
election at the 1999 Annual Meeting who oppose the resolution to
deliver full Net Asset Value (NAV) to all stockholders within 60
days of the date of the 1999 Annual Meeting to resign, and that
the stockholders hereby recommend that such Directors resign
their positions as Directors of the Fund.
Your Board of Directors unanimously opposes this proposal.
Each of the Fund's current Directors brings to the Fund
substantial expertise in business and investment matters
generally, and in Southern African business and investment
matters specifically. Each Director is well qualified to serve
the interests of the stockholders and is committed to do so. The
Board of Directors rejects the notion that any Director should
resign simply because he or she opposes Proposal Three. Since
opposition to this proposal by the Directors is unanimous,
implementation of the recommendation would deprive the Fund of
its entire existing Board of Directors, which would be highly
disruptive and could substantially harm your investment.
Your Board of Directors unanimously recommends that the
stockholders vote AGAINST Proposal Four.
PROPOSAL FIVE
STOCKHOLDER PROPOSAL TO TERMINATE
ADVISORY CONTRACT
The proponent has informed the Fund that the proponent
also intends to present the following recommendation for action
at the Meeting. Adoption of this proposal requires the
affirmative vote of the holders of a majority of the outstanding
shares of the Fund which, as defined by the Act, means the vote
of (1) 67% or more of the shares present at the Meeting, if the
holders of more than 50% of the outstanding shares are present or
represented by proxy, or (2) more than 50% of the outstanding
shares of the Fund, whichever is less.
RESOLVED: That the advisory contract between the Fund
and Alliance Capital Management L.P. be terminated within sixty
(60) days as provided for in the Investment Company Act of 1940.
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Your Board of Directors unanimously opposes this proposal.
Alliance is responsible for your Fund's fine relative
performance. Approval of the Proposal would sever the Fund's
relationship with Alliance, thus disrupting the Fund's investment
program, necessitating extraordinary expenditures and creating a
period of uncertainty that could substantially harm your
investment.
Alliance is one of the world's largest global investment
managers. Unlike almost all of its competitors, Alliance has a
presence in South Africa and has investment resources
specifically dedicated to the Southern African markets. In
addition, at Alliance's recommendation, the Fund retains as its
sub-advisor Gensec, an investment management arm of one of South
Africa's leading financial services groups. The combined
resources of Alliance and Gensec have conferred outstanding
performance on the Fund.
Since its inception in March 1994 through December 31,
1998, the Fund's net asset value cumulative total return was
42.35%, compared to approximately 3.03% for the JSE All Share
Index, the broadly representative Johannesburg Stock Exchange
index against which the Fund's performance has historically been
measured. During this period, the Fund's annualized net asset
value total return was 7.60%, again well ahead of the
approximately 0.63% return of the JSE All Share Index for the
same period.
Alliance and the Fund's Board of Directors regularly
assess the market discount issue and actions which may be taken
for the purposes of enhancing stockholder value and reducing the
discount at which the Fund's share trade from their net asset
values. On the basis of those assessments, Alliance makes
appropriate recommendations to the Fund's Board regarding
measures that may, in addition to tender offers already mandated,
be advisable to provide significant and sustained discount relief
in a manner consistent with the best interests of the Fund and
its stockholders. The share repurchase program referred to above
is such a measure. Alliance is engaged in the development of a
range of other possible measures. These alternatives have in
common the objective of achieving effective discount reduction
without sacrificing the investment advantages that the Fund and
its stockholders now derive from the Fund's closed-end structure.
If approved, Proposal Five would directly terminate the
Fund's investment management agreement with Alliance. The Fund
would immediately lose Alliance's services and the Fund's
investment program would be completely disrupted. This would not
eliminate the Fund's market discount and might very well increase
it. The proponent's Proposal does not suggest any successor
15
<PAGE>
adviser and frankly, your Board of Directors doubts that any
other investment manager would duplicate the expertise and
resources that the combination of Alliance and Gensec brings to
the Fund. Approval of the proposal would override your Board's
determination, reached after careful deliberations, that
continuance of the Fund's current advisory relationship with
Alliance is in the best interests of the Fund. A new agreement
with any adviser would require stockholder approval, which could
only occur months later, after considerable stockholder expense.
During this time, your investment in the Fund could be
substantially harmed.
Your Board of Directors unanimously recommends that the
stockholders vote AGAINST Proposal Five.
PROPOSAL SIX
STOCKHOLDER RECOMMENDATION FOR
REIMBURSEMENT OF FEES AND EXPENSES
The proponent has informed the Fund that the proponent,
referred to therein as the Soliciting Shareholder, also intends
to present the following recommendation for action at the
Meeting. Adoption of this proposal requires the affirmative vote
of a majority of the votes cast thereon at the Meeting.
RESOLVED: That the stockholders hereby recommend that
the Board of Directors authorize and direct the officers of the
Fund to reimburse the Soliciting Shareholder for such reasonable
fees and expenses associated with the initial proxy
communication, including only printing, mailing, distribution,
and tabulating costs, but not including attorneys fees, legal
fees, or other solicitation fees.
Your Board of Directors unanimously opposes this Proposal.
The proponent is undertaking the proxy solicitation
process at the proponent's own risk and other stockholders should
not have to bear any burden of the solicitation through
reimbursement from the Fund. Because the Board of Directors
unanimously believes that the proponent's proposals would be
extremely detrimental to the Fund and the large majority of its
stockholders, the Board cannot agree that reimbursement of any of
the proponent's expenses associated with the proponent's proxy
communication would be an appropriate expenditure of Fund assets.
Your Board of Directors unanimously recommends that the
stockholders vote AGAINST Proposal Six.
16
<PAGE>
INFORMATION CONCERNING THE FUND'S
PRINCIPAL OFFICERS, INVESTMENT ADVISER,
SUB-ADVISER AND ADMINISTRATOR
The principal officers of the Fund and their principal
occupations during the past five years are set forth below. Each
of the officers listed below serves as an officer of one or more
of the other registered investment companies sponsored by
Alliance.
Dave H. Williams, Chairman and President (see page 3 for
biographical information).
Norman S. Bergel, Senior Vice President, 48, a Senior
Vice President of ACMC, with which he has been associated since
prior to 1994; Director and a Senior Vice President of Alliance
Capital Limited ("ACL") since prior to 1994.
Mark H. Breedon, Senior Vice President, 46, a Vice
President of ACMC since prior to 1994; Director and a Senior Vice
President of ACL since prior to 1994.
Russell Brody, 32, a Vice President and Head Trader of
the London desk of ACL, with which he has been associated since
July 1997; prior thereto, he was Head of European Equity Dealing
with Lombard Odier et Cie, London office, since prior to 1994.
Mark D. Gersten, Treasurer and Chief Financial Officer,
48, a Senior Vice President of Alliance Fund Services, Inc.
("AFS") since prior to 1994.
Edmund P. Bergan, Jr., Secretary, 48, a Senior Vice
President and the General Counsel of Alliance Fund Distributors,
Inc. and AFS since prior to 1994.
The address of Messrs. Williams and Bergan is c/o
Alliance Capital Management L.P., 1345 Avenue of the Americas,
New York, New York 10105. The address of Messrs. Bergel, Breedon
and Reeves is c/o Alliance Capital Management International, 53
Stratton Street, London, W1X 6JJ. The address of Mr. Gersten is
c/o Alliance Fund Distributors, Inc., 500 Plaza Drive, Secaucus,
New Jersey 07094.
The Fund's investment adviser is Alliance Capital
Management L.P., with principal offices at 1345 Avenue of the
Americas, New York, New York 10105. The Fund's sub-adviser is
Gensec Asset Management (Pty) Ltd. (formerly Sanlam Asset
Management (Gibraltar) Limited), with principal offices at Suite
110, Neptune House, Marina Bay, Gibraltar. The Fund's
administrator is Princeton Administrators L.P., with principal
offices at 800 Scudders Mill Road, Plainsboro, New Jersey 08536.
17
<PAGE>
Section 16(a) Beneficial Ownership Reporting Compliance
Section 30(h) of the Act and the rules under Section 16
of the Securities Exchange Act of 1934, as amended, require that
the Directors and officers of the Fund and the Directors of ACMC,
among others, file with the Commission and the New York Stock
Exchange initial reports of ownership and reports of changes in
ownership of shares of the Fund. For the fiscal year ended
November 30, 1998, all such reports were timely filed.
STOCKHOLDER PROPOSALS FOR THE NEXT
ANNUAL MEETING OF STOCKHOLDERS
Proposals of stockholders intended to be presented at
the next annual meeting of stockholders of the Fund must be
received by the Fund by November 12, 1999 for inclusion in the
Fund's proxy statement and form of proxy relating to that
meeting. The submission by a stockholder of a proposal for
inclusion in the proxy statement does not guarantee that it will
be included. Stockholder proposals are subject to certain
regulations under the federal securities laws.
The persons named as proxies for the Annual Meeting of
Stockholders for 2000 will have discretionary authority to vote
on any matter presented by a stockholder for action at that
meeting unless the Fund receives notice of the matter by
January 26, 2000 (or such earlier date as may be specified by an
advance notice provision in the Fund's By-laws), in which case
these persons will not have discretionary voting authority except
as provided in the Commission's rules governing stockholder
proposals.
OTHER MATTERS
Except for the intention expressed by the proponent to
nominate certain persons for election as Directors other than the
nominees recommended by the Board of Directors, management of the
Fund does not know of any matters to be presented at the Meeting
other than those mentioned in this Proxy Statement. If any other
matters properly come before the Meeting, the shares represented
by proxies will be voted with respect thereto in accordance with
the best judgment of the person or persons voting the proxies.
According to information filed with the Commission, as
of December 31, 1998, the following persons were the beneficial
owners of more than 5% of the Fund's common stock:
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<PAGE>
Amount of Beneficial Percent of
Name and Address of Beneficial Owner Ownership Common Stock
City of London Investment Group PLC 741,196 shares 12.34
City of London Investment Management
Company Limited
City of London Unit Trust Managers
Limited
10 Eastcheap
London EC3M ILX
England
The State Teachers Retirement 610,900 shares 10.17
Board of Ohio
275 East Broad Street
Columbus, Ohio 43215
Lazard Freres & Co. LLC 407,300 shares 6.78
30 Rockefeller Plaza
New York, New York 10020
President and Fellows of 348,700 shares 5.81
Harvard College
c/o Harvard Management Company, Inc.
600 Atlantic Avenue
Boston, Massachusetts 02210
REPORTS TO STOCKHOLDERS
The Fund will furnish each person to whom this Proxy
Statement is delivered with a copy of the Fund's latest annual
report to stockholders upon request and without charge. To
request a copy, please call Alliance Fund Services, Inc. at (800)
227-4618 or contact Edmund P. Bergan, Jr. at Alliance Capital
Management L.P., 1345 Avenue of the Americas, New York, New York
10105.
By Order of the Board of Directors,
Edmund P. Bergan, Jr.
Secretary
March 12, 1999
New York, New York
19
<PAGE>
PROXY THE SOUTHERN AFRICA FUND, INC. PROXY
PROXY IN CONNECTION WITH THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON APRIL 27, 1999
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned stockholder of The Southern Africa Fund, Inc., a Maryland
corporation (the "Fund"), hereby appoints each of Rita Barnett and Carol H.
Rappa as proxies, each with full power of substitution, to attend the Annual
Meeting of Stockholders of the Fund to be held at 11:00 a.m., Eastern Time, on
April 27, 1999 at the offices of the Corporation, 1345 Avenue of the Americas,
41st Floor, New York, New York 10105, and any postponement or adjournment
thereof, and thereat to cast on behalf of the undersigned all votes that the
undersigned is entitled to cast and otherwise to represent the undersigned
with all powers possessed by the undersigned if personally present. The
undersigned hereby acknowledges receipt of the Notice of Meeting and
accompanying Proxy Statement.
THIS PROXY, IF PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED "FOR"
THE ELECTION OF THE NOMINEES REFERRED TO IN PROPOSAL ONE AS DIRECTORS, "FOR"
THE RATIFICATION OF THE SELECTION OF ERNST & YOUNG LLP AS THE INDEPENDENT
AUDITORS FOR THE CORPORATION, "AGAINST" EACH OF THE STOCKHOLDER PROPOSALS
(PROPOSALS THREE, FOUR, FIVE AND SIX) AS DESCRIBED IN THE ACCOMPANYING PROXY
STATEMENT, AND "FOR" ANY ADJOURNMENT OF THE MEETING WITH RESPECT TO ANY
PROPOSAL DESCRIBED IN THE ACCOMPANYING PROXY STATEMENT IN THE EVENT THAT
SUFFICIENT VOTES IN FAVOR OF THE POSITION ON SUCH PROPOSAL RECOMMENDED BY THE
BOARD OF DIRECTORS ARE NOT RECEIVED PRIOR TO THE MEETING.
Please refer to the Proxy Statement for a discussion of each of the Proposals.
(Continued and to be signed on the reverse side)
20
<PAGE>
1. Election of
Directors. FOR ALL NOMINEES / / WITHHOLD / / FOR ALL EXCEPT / /
Class One Directors (term expires 2002) Dave H. Williams, Prof. Dennis
Davis, Wendy N. Luhabe, Sam N. Montsi
Class Three Director (term expires in 2001) Johannes C. van Reenen
Your Board of Directors urges you to vote "FOR" the election of all
Nominees.
NOTE: If you do not wish your shares voted "FOR" any particular Nominee,
mark the "For All Except" box and strike a line through the name(s) of the
Nominee(s). Your shares will be voted for the remaining Nominees(s).
2. Ratification of the selection of
Ernst & Young LLP as the
independent auditors for the
Fund for the fiscal year ending
November 30, 1999.
Your Board of Directors urges
you to vote "FOR" Proposal Two.
FOR / / AGAINST / / ABSTAIN / /
3. To approve, if presented, a
stockholder recommendation
(Proposal Three) as described in
the Proxy Statement for the Annual
Meeting.
Your Board of Directors urges you
to vote "AGAINST" Proposal Three.
FOR / / AGAINST / / ABSTAIN / /
4. To approve, if presented, a
stockholder recommendation
(Proposal Four) as described in
the Proxy Statement for the Annual
Meeting.
Your Board of Directors urges you
to vote "AGAINST" Proposal Four.
FOR / / AGAINST / / ABSTAIN / /
5. To approve, if presented, a
stockholder proposal (Proposal
Five) as described in the Proxy
Statement for the Annual Meeting.
Your Board of Directors urges you
to vote "AGAINST" Proposal Five.
FOR / / AGAINST / / ABSTAIN / /
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<PAGE>
6. To approve, if presented, a
stockholder recommendation
(Proposal Six) as described in the
Proxy Statement for the Annual
Meeting.
Your Board of Directors urges you
to vote "AGAINST" Proposal Six.
FOR / / AGAINST / / ABSTAIN / /
7. In their discretion, upon any
other matters that may properly
come before the Annual Meeting or
any postponement or adjournment
thereof, as described in the Proxy
Statement.
Note: Please sign this proxy exactly as
your name(s) appear(s) on the books of
the Fund. Joint owners should each
sign personally. Trustees and other
fiduciaries should indicate the
capacity in which they sign; and, where
more than one name appears, a majority
must sign. If a corporation, the
signature should be that of an
authorized officer who should state his
her title.
Dated:__________________________, 1999
______________________________________
(Signature of Stockholder)
______________________________________
(Signature of joint owner, if any)
Votes must be indicated
PLEASE VOTE, SIGN AND DATE THIS (x) in Black or Blue ink. / /
PROXY ON THE REVERSE SIDE AND
RETURN IT IN THE ENCLOSED
ENVELOPE.
22
0250160.BA5
