CORRECTION: $800mln Amoun sale gives 3 private equity firms their exits, AfDB backs AfricInvest III and AFIG II and others make african private capital news last week

July 20th, 2015

The weekly roundup of Africa's Private Capital news

Click here to receive AfCD in your email inbox weekly

Our apologies for sending out this week's edition of AfCD with some link problems about 30 minutes ago. Here is this week's edition with the link snafus corrected.

Many thanks for your patience.

Best Wishes,

Team AfCD

This week's issue supported by...

The week in brief...

Serial acquirer Valeant Pharmaceuticals stepped into Africa's deal landscape last week with its $800 million acquisition of Egypt's largest domestic drug-maker, Amoun Pharmaceuticals. The deal gives three private equity firms the exit they were looking for--Capital Group, Concord International and The Rohatyn Group (through Citigroup Venture Capital International which it acquired in 2013) acquired 98% of Amoun for $500 million in one of the largest private equity transactions executed in Egypt at the time.

The deal gives Valeant the start of a platform to expand further in the Middle East and North Africa. In acquiring Amoun, which is expected to generate $220 million in revenue this year, Valeant gets one of the largest, most up-to-date pharmaceutical manufacturing facilities in the region as well as a portfolio of market-leading brands.

A couple of high-profile, announced deals came to successful completions last week. Of the two, Brait's $1 billion acquisition of an 80% stake in Virgin Active from CVC Capital and Virgin Group was the larger. The deal, which was announced in April, allows CVC Capital to exit its 51% stake entirely, more than doubling its investment in the process, according to some sources. The Virgin Group and Virgin Active's management will retain a 20% stake in the company.

Meanwhile, Emerging Capital Partners has successfully completed the sale of its 24% stake in financial services group NSIA Participations to Amethis Finance and National Bank of Canada. The deal was originally reported in late March, when, as now, financial terms for the deal remained undisclosed.

In fund raising news, African Development Bank's Board of Directors has approved commitments to two private equity firms. In the first, the Board signed off on an equity investment of up to $45 million in AFIG Funds' Atlantic Coast Regional Fund II (AFIG Fund-II), a 10-year, $300 million, multi-sector private equity fund. The fund, which will focus on opportunities in West, Central and East Africa, reportedly has a strong deal pipeline with over $400 million in potential investments.

And in the second, the Bank is making a 20 million euro commitment to private equity firm AfricInvest's third fund. The fund, which is targeting 200 million euros is planning to invest growth equity in midcap companies on the continent, creating a group of regional champions. The fund aims to source deals across Africa in a number of sectors that are expected to see rapid growth, including manufacturing, agribusiness, healthcare, financial services, energy and consumer goods.

Seven Energy, the Nigerian Oil and Gas company which counts several private equity, sovereign wealth and DFI funds among its investors, is taking on almost $500 million in fresh debt to help build and improve its gas infrastructure in preparation for planned purchases of gas fields and pipelines in the country. In 2014, the company raised $255 million in equity from investors which included Singapore's sovereign wealth fund, Temasek, to help it build up its gas business. The new debt is being provided by a consortium of lenders that includes First Bank, Eco Bank, FCMB, Union Bank, United Bank for Africa, FBN Bank UK and Union Bank UK.

And finally, with Brait very much in the news over the last few months, an interesting interview with its CEO, John Gnodde. He talks to CNBC Africa's Bronwyn Nielsen about Brait's approach to building its portfolio of consumer facing companies, the firm's relationship with anchor investor Christo Wiese, ("symmetry in thinking, ...business building, ...focusing on the fundamentals"), and how he looks to drive value through growth, margin expansion and cash flow generation.

You can review these and other stories by scrolling down and reviewing the headlines, abstracts and links.

Deal News...

Private Equity

Capital, Concord, Rohatyn exit Amoun in $800mln deal // africacapitaldigest.com

Three private equity firms are exiting Egypt's largest domestic drug-maker following Valeant Pharmaceutical's definitive agreement to acquire Amoun Pharmaceuticals for $800 million last week. The deal, which is subject to customary closing conditions, is expected to close in the third quarter.