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.
Thank you for being a reader and we look forward to continuing to keep you informed on the private capital investment themes, deals and fundraisings in Africa.
We'd be delighted if you shared it with any interested colleagues and/or partners. If they would like to receive their own weekly copy, they're more than welcome to sign up here.
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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Deals inspired by the rise of the Africa's consumers were the them of the week last week. A consortium made up of a couple of private equity investors and a development finance institution made the largest capital commitment of the week.
8 Miles led an $80 million club deal in Nigerian biscuit manufacturer
Beloxxi, joining forces with Lagos-based
African Capital Alliance and German development finance institution
DEG in a bet that rising populations, increasing incomes and levels of urbanization will continue to drive levels of growth within the biscuit sector which has expanded at rates of 10% to 15% in recent years.
DEG confirmed it was investing $10 million in the deal, but details on how the balance was split between the other two members of the consortium were hard to come by.
A potential investment by the
IFC in South Africa's fiber networking sector could be a little larger, in dollar terms, than the Beloxxi. The DFI is considering an investment made up of equity and quasi-equity and totaling $111 million for a stake in the special purpose vehicle that will be set up to hold the combined interests of the
Liquid Telecom and
Royal Bafokeng Holdings' planned $560 million acquisition of
Neotel.
With over 24,000 kms of long distance backbone servicing 12 countries, Liquid Telecom has major operations in Kenya, Nigeria, Rwanda, South Africa, Zambia and Zimbabwe.
Tata Communications, Nexus Connexion and
CommuniTel have agreed to sell Neotel following a recent competitive bidding process, so it seems likely that the IFC's board will approve the investment when they meet to review it in mid-September.
In the latest news of a slew of investments,
African Rainbow Capital, the private equity investment company set up by Patrice Motsepe, recently announced that it will invest R120 million or approximately $9 million to acquire 29.9% of
CMB International, the Mauritius-listed financial services holding company which acquired investment banking and advisory firm
Bravura in December 2015.
The capital will be used to support the firm's acquisition plans and other growth initiatives.
CMB International was originally incorporated in August 2015, since when it has acquired six financial services businesses. The companies provide a range of corporate finance, structured solutions and property investment services to their clients in Southern African and Australia.
South African fintech startup Zoona has successfully closed a $15 million Series B round, raising capital from a number of new as well existing investors. The round was led by the IFC, which provided $7.5 million in funding, while new investors 4Di Capital and Google CFO Patrick Pichette joined Series A backers Quona Capital, Omidyar Network and Lundin Foundation in providing the balance of the round. Additional terms of the deal were not disclosed.
An article that first appeared in
EMPEA's Summer Legal & Regulatory Bulletin caught our eye last week.
Folake Adebowale, a Partner at Nigerian law firm Udo Udoma & Belo-Osagie, looks at the impact the measures adopted by the Central Bank of Nigeria to manage access to the official foreign exchange market will have for foreign investors.
On the jobs front,
Arise, a $660 million private equity investment holding company established by
FMO,
Norfund and
Rabobank, is about to embark on an aggressive hiring campaign in order to support its operations which are scheduled to start in January 2017. Deepak Malik, Norfund's Regional Director for Southern Africa tells
Bloomberg
that the financial services-focused investment company is looking to hire between 20 and 25 people over the next 6 months to help manage its portfolio of investments and deploy another $300 million on acquisitions.
And finally, it's being reported that Marlon Chigwende, Managing Director and Co-Head of private equity giant
Carlyle's business in Sub-Saharan Africa, is leaving the company to set up his own fund to pursue investment opportunities across the continent. He joined Carlyle in 2011, the same year which saw the launch of the Carlyle Sub-Saharan Africa Fund. We'll keep you updated as both this story and his plans evolve.
As always, you can review these and other stories by scrolling down and clicking through to them below.
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The IFC is mulling a $111mln investment in the special purpose vehicle being set up to hold the combined interests of Liquid Telecom and Royal Bafokeng Holding's planned $560 million acquisition of Neotel |
Private Equity
8 Miles, ACA and DEG back Beloxxi in $80mln deal
Africa-focused private equity firms 8 Miles and African Capital Alliance are joining forces with German DFI DEG to invest $80 million in Beloxxi for a significant minority stake. The capital will be used by the Nigerian biscuit manufacturer to help it ramp up production and satisfy significant levels of unmet demand in the country as well as the broader West African region.
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Private Equity
IFC mulls $111mln backing for Liquid/Neotel deal
The IFC is considering an investment made up of equity and quasi-equity and totaling $111 million for a stake in the special purpose vehicle that will be set up to hold the combined interests of Liquid Telecom and Royal Bafokeng Holdings' planned $560 million acquisition of Neotel, South Africa's second largest wholesale fiber network, by Liquid Telecommunications and community-based investment company Royal Bafokeng Holdings.
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Private Equity
ARC acquires 29.9% of Bravura parent, CMB International
African Rainbow Capital, the private equity investment company set up by Patrice Motsepe, recently announced that it will invest R120 million or approximately $9 million to acquire 29.9% of CMB International, the Mauritius-listed financial services holding company which acquired investment banking and advisory firm Bravura in December 2015. The investment, which is subject to regulatory approval, is split equally between an issuance of fresh equity and a preference share facility.
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Zoona lands $15mln for Series B
South African fintech startup Zoona has successfully closed a $15 million Series B round, raising capital from a number of new as well existing investors. The round was led by the IFC, which provided $7.5 million in funding, while new investors 4Di Capital and Google CFO Patrick Pichette joined Series A backers Quona Capital, Omidyar Network and Lundin Foundation in providing the balance of the round. Additional terms of the deal were not disclosed.
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This week's issue supported by...
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Strategies
Swastika trains its sights on African VC opportunities
The unfortunately named Swastika, a seed stage investment fund based in Hong Kong, is setting its sights on more African investments. Typically investing up to $250,000 in deals, Vaibhav Jain, a Director with the firm, tells
DealStreetAsia that the firm ultimately aims to have 10 to 12 startup investments on the continent.
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Perspectives
Nigeria's FOREX market changes a boost to private equity
Folake Adebowale, a Partner at Nigerian law firm Udo Udoma & Belo-Osagie, looks at the impact the measures adopted by the Central Bank of Nigeria to manage access to the official foreign exchange market will have for foreign investors. The key change for private equity investors is that they are now able to convert capital into Naira at market-determined rather than central bank-determined rates.
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Perspectives
Indigenous investors new engine for Africa's growth
While Africa's investment appeal grows for both local and international investors, it's the local investors who lead the pack as the greatest source of investment capital for Africa's economies. EY reports that intra-Africa investment has grown by 32.7% since 2007, four times faster than investment flows from developed economies. South Africa, Kenya, Nigeria and Namibia lead the continent's investor league table.
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Companies, People & Profiles...
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Companies
Arise to enter "extreme recruitment phase"
Following
the announcement a couple of weeks ago about the launch of Arise, a $660 million private equity investment holding company established by FMO, Norfund and Rabobank,
Bloomberg reports that the financial services sector-focused company is about to embark on an aggressive hiring campaign in order to support its operations which are scheduled to start in January 2017.
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People
Chigwende set to leave Carlyle
Marlon Chigwende, Managing Director and Co-Head of private equity giant Carlyle's business in Sub-Saharan Africa, is reportedly leaving the company to set up his own fund to pursue investment opportunities across the continent. He joined Carlyle in 2011, the same year which saw the launch of the Carlyle Sub-Saharan Africa Fund.
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Investment Officer, Private Equity Real Estate at ACA
Based in Lagos, Nigeria
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Chief Financial Officer for leading Private Equity firm
Based in Harare, Zimbabwe
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Senior or Principal Investment Officer at the IFC
Based in Johannesburg, South Africa
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Associate, Corporate Finance Advisory at MCB Capital Markets
Based in Port Louis, Mauritius
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Senior or Principal Investment Officer at the IFC
Based in Washington, DC, USA
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Investment Associate, Impact Investments at CDC
Based in London, United Kingdom
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Private Equity Analyst at ACA
Based in Lagos, Nigeria
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14th Annual African Capital Markets Conference
Cape Town, November 30th to December 1st, 2016
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The Global African Investment Summit Kigali
Kigali, September 5th to September 6th, 2016
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London, September 14th to September 16th, 2016
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3rd Africa Alternative Investment Intensive
New York, September 19th to September 20th, 2016
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Lagos, September 20th, 2016
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Tanzania Infrastructure & New Energy Investment
Dar es Salaam, September 21st, 2016
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Kenya International Renewable Energy Congress
Nairobi, October 3rd to October 5th, 2016
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8th Africa PPP Conference & Showcase
London, October 24th to October 26th, 2016
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Dubai, October 24th to October 26th, 2016
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Sub-Saharan Africa Power Forum 2016
Cape Town, October 26th to October 28th, 2016
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International Islamic Banking Summit Africa
Djibouti, November 2nd to November 3rd, 2016
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3rd Annual Infrastructure Project Financing Africa
Nairobi, November 7th to November 9th, 2016
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Investing in Emerging Markets Summit
Johannesburg, November 16th to November 17th, 2016
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Cape Town, November 29th to December 1st, 2016
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The Global African Investment Summit London
London, November 30th to December 1st, 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 © 2016 Rowayton Press, LLC. All Rights Reserved.
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