The
weekly roundup of Africa's Private Capital news
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Here's the latest weekly wrap of the most interesting Africa-related private equity, infrastructure and venture capital deal stories, market opinion articles and information pieces.
Thanks you being a reader and we look forward to continuing to keep you informed on the private capital investment themes, deals and fundraisings in Africa.
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As always, if you have any tips, suggestions or questions, please reach out to Allan Cunningham at
[email protected]
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This week's issue supported by...
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In private equity deal news in Africa last week, London-headquartered Duet Group, the alternative investment management firm with more than $5 billion in assets is paying $18.6 million for an undisclosed minority stake in Kenya's Fidelity Commercial Bank. The deal is being done through Duet's East African Financial Holdings entity and the capital injection will be used to help Fidelity achieve its regional expansion ambitions. The investment gives Duet a strong platform to invest in Kenya's banking sector which Henry Gabay, Duet's Co-Founder and CEO sees as being ripe for consolidation.
On the western side of the continent, meanwhile,
Synergy Capital Management closed its sixth investment for its first $110 million fund, taking an undisclosed stake in
Suburban Fiber Company, a broadband provider that delivers content products and services to residential customers in Abuja and Lagos. The capital has been earmarked for investment plans in the firm's technology platform as well as for content development and service marketing initiatives to attract new customers to its services.
In Zimbabwe,
AfricInvest is joining forces with
MicroCred to acquire microfinancier
MicroKing from the country's Deposit Protection Corporation, which liquidated MicroKing's parent company,
Afrasia Bank Zimbabwe, in February last year. It's expected that this investment will be followed by an additional capital injection plan funded by both of MicroKing's new shareholders in order to provide the institution with the means to properly execute its strategy. The liquidity challenges at AfrAsia Bank Zimbabwe had a serious impact on MicroKing, forcing it to curtail its lending operations.
Impact investor
Investisseurs & Partenaires announced an undisclosed capital commitment to Teranga Capital, an equity impact fund which will target deals ranging from €75,000 to €300,000 in promising businesses in Senegal.
Teranga Capital, which is the third fund backed by I&P's impact fund-of-funds, IPDEV2, manages €5 million, and counts several Senagalese institutional and private investors among its supporters, including the Sovereign Fund for Strategic Investments (FONSIS) and SONATEL. This is the third fund backed by I&P, which aims to invest in ten impact funds in ten African countries over the next 10 years.
Abraaj's Growth Markets Healthcare Fund, which is currently raising, landed a $25 million commitment from the
African Development Bank for African healthcare investments. The fund, which has a hard cap of $1 billion, will target opportunities driven by the expanding demand for healthcare services from Africa's growing middle class and rapidly urbanizing population, improving the quality of healthcare infrastructure and healthcare services.
In portfolio company news,
Endeavor Energy, the
Denham Capital-backed power generation firm, has received approvals to begin development of a gas-fired power station in Côte d'Ivoire and is looking to source $900 million to finance the project. According to
Reuters, the company's CEO is confident in finding an "over-supply of financing" for the project.
We found a couple of interesting pieces on the investment plans and strategies of firms on the continent last week. According to South Africa's
Business Day,
Tiso Blackstar, the investment company that emerged from the merger of Blackstar plc and Tiso Investment Holdings in 2015, looks set to hone its focus on the media sector and start divesting itself of non-media assets in a range of sectors including the financial services, healthcare and industrial sectors. The move will allow the investment company to build value through a concentrated approach rather than risk dilution that can occur with a multi-sector strategy.
And in another indication of the rising interest in Africa from Islamic financiers,
China-Africa Fund, the Beijing-based private equity firm, and the
Islamic Corporation for the Development of the Private Sector signed a Memorandum of Understanding to explore and execute co-financing and co-investment opportunities in up to 19 countries on the continent.
To read more on these and other stories from the last week, please scroll down for the abstracts and links.
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Online deals company DealDey acquired by Ringier Africa Deals Group, a new JV between Ringier Africa and Silvertree Investment Holdings
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Private Equity
Duet invests $18.6mln for Fidelity Bank stake
Alternative investment management firm Duet Group is paying approximately $18.6 million for an undisclosed stake in Kenya's Fidelity Bank. None of the bank's current shareholders are exiting their holdings. The deal, which is subject to regulatory approvals, will boost the bank's capital base to approximately $36 million.
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Private Equity
For sixth deal, Synergy Capital backs Suburban
In its sixth investment for its debut fund, Nigerian private equity firm Synergy Capital Managers is backing Suburban Fiber Company, a broadband provider that delivers content products and services to residential customers in Abuja and Lagos. Terms of the deal were not disclosed. The capital will be used to support additional investment in the firm's technology platform as well as for content development and service marketing initiatives to attract new customers to its services.
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Private Equity
AfricInvest and MicroCred in MicroKing buyout
Private equity investment manager AfricInvest and MicroCred, a microfinance institution, have joined forces to acquire MicroKing Finance, a provider of microfinance products serving the micro, small and medium enterprise market in Zimbabwe. Once the deal has received regulatory approval, AfricInvest's Financial Sector Fund will own 30% of MicroKing with MicroCred owning the remaining 70% balance of the firm. Additional terms of the deal were not disclosed.
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Private Equity
New Ringier Silvertree JV buys Nigeria's DealDey
Ringier Africa Deals Group, a new joint venture between Ringier Africa, the Swiss digital media company and Silvertree Internet Holdings, the South African investment company, has announced the acquisition of Nigerian online deals and ecommerce company DealDey in an undisclosed deal.
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Funds & Fundraising News...
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Private Equity
AfDB backs Abraaj Growth Markets Healthcare Fund
The African Development Bank's Board of Directors has approved a $25 million commitment to the Abraaj Growth Markets Health (Africa) Fund, the parallel Africa-focused partnership of Abraaj's Growth Markets Health Fund, which is currently in the market looking to raise up to $1 billion.
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Private Equity
I&P backs impact investor Teranga Capital
Impact investor Investisseurs & Partenaires (I&P) announced an investment on behalf of its impact fund-of-funds, IP Développement 2 or IPDEV2, in Teranga Capital, an equity impact fund which will target deals ranging from €75,000 to €300,000 in promising businesses in Senegal.
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Projects & Portfolio Companies...
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Endeavor Energy looking for $900 million in financing
Endeavor Energy, the Houston-based developer, owner-operator power generation firm backed by Denham Capital, is looking for financing for a $900 million gas-fired power station project in Côte d'Ivoire. The Africa-focused company has received approvals to build the plant which will initially produce 375 MW rising to 1,200MW once fully operational. The company's CEO tells Reuters that he is confident of "an over-supply of financing" for the project.
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This week's issue supported by...
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Banking sector still offers large opportunity
While the commodity slump is taking some of the bloom off the African rose, the continent's financial services sector remains a key investment opportunity in slower growth economies. The businesses provide investors with exposure to the middle class consumer in Africa, a market typified by expanding incomes and growing consumption habits.
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CADFund and ICD agree Africa co-investment MoU
At the China-OIC Forum last week, the China-Africa Development Fund or CADFund, the Beijing-based private equity firm, and the Islamic Corporation for the Development of the Private Sector, an arm of the Islamic Development Group announced the two institutions had signed a Memorandum of Understanding to explore and execute co-financing and co-investment opportunities in up to 19 countries on the continent.
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Tiso Blackstar to hone media sector focus
Tiso Blackstar, the investment company that emerged from the merger of Blackstar plc and Tiso Investment Holdings in 2015, looks set to hone its focus on the media sector and start divesting itself of non-media assets in a range of sectors including the financial services, healthcare and industrial sectors. Timing of exits will be determined by market conditions and the firm's ability to price the assets to maximize shareholder value. Business Day reports that the move will allow Tiso Blackstar to build value via a concentrated approach and minimize the dilutory valuation effect of a multi-sector investment platform.
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Perspectives
Growth of impact capital has investors excited
As the impact investment style finds more favor among certain institutional investors,
Business Day TV interviewed Max Pichulik, a Partner at Impact Amplifier, on the opportunities and challenges impact investing offers investors looking to combine financial returns with social gain in South Africa.
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Perspectives
Winning the race between debt and growth
As African countries' indebtedness increases, what criteria will determine which will look better- positioned to ride out the current credit market headwinds and why? Khaya Gobodo and Antoon de Klerk of Investec Asset Management outline their expectations in this piece in Institutional Investor last week, noting that those economies in which government spending has been efficiently deployed in long-term infrastructure initiatives rather than satisfying other demands will fare much better in the race between debt and growth.
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This week's issue supported by...
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Abraaj, Actis, GE Africa, Kuramo discuss niche private equity strategies
As more private equity capital flows into Africa, competition for deals is hotting up. The pressure for investors to differentiate their strategies and sharpen their competitive edge is rising. At Columbia University's annual Africa conference, senior executives from Abraaj, Actis, GE Africa and Kuramo Capital will look at some examples of niche investment strategies and discuss the advantages and the constraints facing them.
Columbia University's African Economic Forum
April 2nd, 2016
New York
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Companies, People & Profiles...
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Companies
Nomura officially sets up shop in South Africa
Nomura, the Japanese-headquartered global investment bank, is opening an office in Cape Town to offer mergers and acquisition advisory services and transaction financing services to both multinational and domestic companies. The new office will be led by Jan Newman, one of the co-founders of Newman Lowther & Associates, an advisory business with which Nomura had an exclusive cross-border M&A partnership for deals into and out of South Africa.
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People
Leautier to join AfDB as Senior Vice President in May
It was announced last week that Chair and Co-Founding Partner of Tanzania's Mkoba Private Equity Fund, Dr. Frannie Leautier, has been appointed as the Senior Vice President of the Africa Development Bank. She takes up her new role in early May.
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People
Le Bouder promoted at AFIG Funds
Stéphane Le Bouder, who joined Advanced Finance and Investment Group (AFIG Funds) in 2013, has been promoted to Managing Director at the Dakar-based private equity fund manager. Prior to joining AFIG Funds, Le Bouder has worked within the Obama administration in Washington, DC where he served as Deputy Assistant Secretary for International Affairs at the U.S. Treasury.
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Investment Analyst at Enko Capital
Based in Johannesburg, South Africa
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Investment Director, Corporate Finance at CDC
Based in London, United Kingdom
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Investment Director, Project Finance at CDC
Based in London, United Kingdom
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Investment Associate at CrossBoundary
Based in Bamako, Mali
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Investment Associate at Enko Capital
Based in Johannesburg, South Africa
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Associate for Africa-focused Private Equity firm
Based in London, United Kingdom
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Associate, Development Impact at CDC
Based in London, United Kingdom
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Regional Investment Director at leading DFI
Based in Ogun, Nigeria
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Investment Manager, Infrastructure Equity at CDC
Based in London, United Kingdom
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Project Finance & Corporate Finance Associates for law firm
Based in London, United Kingdom
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Southern Africa Energy & Infrastructure Summit
Maputo, May 4th to May 6th, 2016
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Columbia University's 2016 Africa Economic Forum
New York, April 2nd, 2016
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Duke University's 2016 Business in Africa Conference
Durham, NC, April 2nd, 2016
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Africa's Investment Prospects - The 2016 Annual Debate
London, April 20th, 2016
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Zambia International Investment Forum
Lusaka, April 21st to April 22nd, 2016
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13th Annual AVCA Conference
Addis Ababa, April 25th to April 27th, 2016
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Africa Financial Services Investment Conference 2016
London, May 5th to May 6th, 2016
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Global Private Equity Conference
Washington, DC, May 9th to May 12th, 2016
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18th Annual Africa Energy Forum
London, June 21st to June 24th, 2016
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We hope you found the digest to be a useful summary of the major happenings in Africa's private capital markets last week. We'd love it if you shared it with colleagues and business partners. They can sign up for free
here.
Best wishes for a productive week - if you have any tips, suggestions, questions or comments, please get in touch.
All the best,
- Allan
Allan Cunningham
Editor & Publisher
AfCD | Africa Capital Digest
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Africa Capital Digest is a product of Rowayton Press
Rowayton, CT 06853, USA
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Copyright © 2014-2015 Rowayton Press, LLC. All Rights Reserved.
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