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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As if to underline a contributed article that appeared in the
Financial Times last week on how, in many African countries, the solar power technology has reached grid cost parity with conventional sources of power which should dramatically boost its usage in the continent's energy mix,
Investec Asset Management announced a significant private equity investment in
Mobisol, a provider of solar home systems in East Africa.
This transaction was the most high-profile of the week. Berlin-headquartered Mobisol, which is already well-established in the Tanzanian and Rwandan markets, will use the fresh capital to accelerate its expansion in both existing and new markets. Efforts are already underway to penetrate the neighbouring Kenyan market.
Otherwise, it was a relatively quiet week, deal-wise. Africa's largest fund manager, the
Public Investment Corporation and its partner,
Business Ventures Investments, had their bid to acquire
Sub-Saharan Industrial Holdings approved by the South Africa's Competition Tribunal. Between them, both investors will own 75% of the transport and logistics company. And
Motlekar Holdings, which is described as a private equity enterprise, invested in what appears to be a distressed opportunity by acquiring grounded airline
LCC Skywise in an undisclosed deal. Skywise started operating flights between Johannesburg and Cape Town in 2015 before being grounded due to its failure to pay its bills.
We found out last week that
Metier held the final close for its second private equity fund in mid-September, raising a total of R2.8 billion or a little over US$200 million from a broad range of institutions - development finance institutions, fund-of-funds as well as a range of South African pension funds and other asset managers. The fund aims to deliver returns in line with the track record of Metier's team, namely a 36% IRR and 2.6x money (in South African Rand, gross). A total of fourteen investors committed capital to the fund raise, eight of whom are re-upping from Metier's prior funds.
On a smaller scale, the
IFC revealed last week that is is mulling a $7.5 million commitment to
Fanisi Capital's second fund which will target private equity opportunities in SMEs in East Africa. The fund, which is targeting $75 million with a hard cap of $100 million, is hoping to hold a first close during the final quarter of this year. The development finance institution's board is expected to met in early November to review the proposed investment.
As you may have heard, there's a growing consensus of an inflating private equity bubble in Africa recently as more and more capital chases a small number of potential deals.
The Boston Consulting Group thinks differently. In spite of the risks, it finds that the continent remains one of the world's greatest growth opportunities for the private equity industry and takes a look at the factors that underpin this bullish outlook.
And finally this week, Nigeria's government in planning to raise significant debt in the coming months to finance the US$19.4 billion plan to jump start the country's slumping economy. A piece by the
Brookings Institution looks at the upcoming auctions and at why the country's Debt Management Office is confident of Nigeria's ongoing ability to service the debt.
As always, you can review these and other stories by scrolling down and clicking through to them below.
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Investec takes significant stake in off-grid solar power provider Mobisol Image Credit: Mobisol |
Private Equity
Investec backs off-grid solar power play Mobisol
Investec Asset Management is making a significant private equity investment in Mobisol, a provider of off-grid solar home systems in Africa. The capital will be used to accelerate the firm's expansion in both existing and new markets on the continent. Terms of the transaction were not disclosed.
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Private Equity
PIC's bid to acquire SSA holdings approved
South Africa's Competition Tribunal has approved the acquisition of a controlling stake in Sub-Saharan Industrial Holdings, a large transport and logistics services provider, by the Public Investment Corporation, the continent's largest asset manager, and Business Ventures Investments. Between them the two firms hold a 75% interest in the company. The value of the transaction was not reported.
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Private Equity
LCC Skywise sold to Motlekar Holdings
South African private equity firm Motlekar Holdings is acquiring grounded airline LCC Skywise in an undisclosed deal according to airline industry information company CH-Aviation. LCC Skywise started operating flights between Johannesburg and Cape Town before being grounded due to its failure to pay outstanding debts.
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Funds & Fundraising News...
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Private Equity
Metier hits R2.8bn for MCGF II's final close
Metier, the Southern African private equity firm, held the final close for its second fund in mid-September, raising R2.8 billion, (approximately US$ 203 million at current exchange rates), for the ten-year investment vehicle. The fund will target growth capital opportunities in entrepreneurial mid-cap businesses in South, Southern and Sub-Saharan Africa.
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Private Equity
IFC mulls $7.5mln commitment to Fanisi's second fund
The IFC's Board is mulling a commitment of up to $7.5 million to Fanisi Capital's second fund which will target private equity opportunities in SMEs in East Africa. The fund, which is targeting $75 million with a hard cap of $100 million, is hoping to hold a first close during the final quarter of this year.
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This week's issue supported by...
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Financial Services PIC has appetite for a bigger slice of Barclays Africa
As suitors for Barclays' Africa assets chop and change, PIC, the manager of South Africa's Government Employee Pension Fund still has an appetite to expand its holding in the financial services company and is currently considering potential investment partners to team up with and make a bid.
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Power
Africa's power projects and their success criteria
Power generation offers investors and developers significant opportunities in Africa. A review of some of the development issues specific to the continent and some of the key criteria for success.
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Renewable Energy Solar energy comes of age in Africa
As costs of solar plant and equipment continue to drop, in many African countries the technology has reached grid parity with conventional sources of power despite suppressed commodity prices. Including more solar power in Africa's energy mix now makes even more sense.
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Nigeria plans major Bond auctions to finance record budget
Nigeria's Government in planning to raise significant debt in the coming months to finance the $19.4 billion plan to jump start the country's slumping economy. Now experiencing the worst recession in decades and with oil prices still at historic lows, ratings agencies have downgraded the country's sovereign credit rating further.
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A private equity bubble in Africa? Think again
As consensus grows that a private equity bubble is inflating in Africa's investment markets and risks are multiplying, The Boston Consulting Group finds that the continent remains one of the world's greatest growth opportunities for the private equity industry. The piece lays out the factors that support this bullish outlook.
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Investor realignment rather than retrenchment
Chinelo Anohu-Amazu, the Head of Nigeria's Pension Fund Committee, tells African Business that, despite talk of investor retrenchment on the continent, her experience is different. Rather than a scaling back of investment what's happening is a realignment.
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Private equity slumps in Africa's buyer's market
With the recent release of AVCA's 2016 Private Equity Data Tracker which shows a marked slowdown in the value of private equity deals on the continent compared with 2015, Kurt Davis asks where are the continent's private equity buyers in the market at the moment. Without providing direct answers, he summarizes the current macroeconomic situation and reminds us where the opportunities are likely to be found in 2017.
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Companies, People & Profiles...
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People
Sivanithy to lead origination and due diligence at Rede
Dushy Sivanithy is joining fundraising advisory firm Rede Partners in the newly created role of Head of Origination and Due Diligence where he will oversee the firm's origination activity across Rede's primary fundraising, secondary and strategic advisory services as well as the firm's due diligence processes.
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People
Maitland appoints Swart to head up governance function
Maitland has tapped Martina Swart to head up the advisory and fund administration firm's governance function. In the newly created role of Group Head of Governance Services, she'll be responsible for the day-to-day management of governance services which includes regulatory, compliance and risk management.
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Director, Project Finance at Africa50
Based in Casablanca, Morocco
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Based in New York, United States
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Based in New York, United States
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Based in Johannesburg, South Africa
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Based in London, United Kingdom
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Based in Johannesburg, South Africa
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Dubai, October 24th to October 26th, 2016
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Abuja, October 12th to October 14th, 2016
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8th Africa PPP Conference & Showcase
London, 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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Africa Renewable Energy Forum
Marrakech, November 2nd to November 4th, 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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African Agri Investment Indaba
Cape Town, November 28th to November 30th, 2016
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Cape Town, November 29th to December 1st, 2016
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14th Annual African Capital Markets Conference
Cape Town, November 30th to December 1st, 2016
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Global Solutions Summit 2016
Little Rock, December 13th to December 14th, 2016
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Investing in African Mining Indaba
Cape Town, February 6th to February 9th, 2017
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Pensions Funds & Alternative Investments Africa
Balaclava, Mauritius, March 15th to March 17th, 2017
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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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