October 17th, 2016
The  weekly roundup of Africa's Private Capital news


 

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 acunningham@africacapitaldigest.com
This week's issue supported by...             
SuperReturn Africa 2016
The Week in Brief...
Deal activity in Africa bounced back last week, featuring both acquisitions and exits by private capital investors focused on the continent. High-profile growth markets investor The Abraaj Group was among them, plonking down an undisclosed amount to acquire a minority stake in Indorama Fertilizers, the largest manufacturer of urea-based fertilizers in sub-Saharan Africa.

The investment is a bet, of course, on long-term growth for the fertilizer company, driven by rising populations and rising incomes creating more demand for food on the continent. Given urea's high nutrient content, its ease of use and Indorama's competitive production costs and execution capabilities, Abraaj feels that the firm is well-placed to become a key global producer and exporter.

In Morocco, Mediterrania Capital Partners is taking a significant minority stake in Université Privée de Marrakech (UPM) through MCP II, its second, €120 million fund. While no further details of the transaction were disclosed, Mediterrania Capital typically targets growing SMEs with an equity value ranging from €25 million to €400 million which have growth ambitions in both North Africa and sub-Saharan Africa. With this deal, MCP joins fellow private equity firm Development Partners International in UPM's capital structure following the London-based fund managers $20 million investment in March 2014.

West Africa-focused investor Synergy Capital Managers announced the seventh deal for its $100 million private equity fund last week, making an undisclosed investment in Vester Oil Mill, one of Ghana's largest seed oil mill operators. With the additional capital and access to Synergy Capital's expertise and networks, its hoped to expand the company to offer edible food oils for end users across West Africa and beyond.

Across the continent in East Africa, meanwhile, Nairobi-based Catalyst Principal Partners announced it is taking a controlling stake in Zenufa Laboratories, a Tanzanian pharmaceutical manufacturer. While additional terms of the deal were not disclosed, Catalyst Fund I typically aims to invest between $5 million and $20 million in its transactions, looking to generate net cumulative returns of between 20% and 25%. The Zenufa deal is the fund's eight transaction and fits well with its strategy of backing emerging or mid-sized companies which are poised to benefit from market demand generated by the region's emerging middle class.

Cauris Management, the first regional private equity fund manager established in Francophone West Africa announced full exits from two financial services portfolio holdings at the end of September. The first stake, in Atlantic Business International, a financial services partnership between West Africa's Atlantic Financial Group and Morocco's Banque Centrale Populaire, was first backed by Cauris in December 2012 in a €6.3 million equity/debt transaction. The holding is being sold to Banque Centrale Populaire, earning Cauris a 1.7x return.

The second exit for Cauris sees the sale of its stake in Bridge Bank Group Côte d'Ivoire (BBG-CI) to the Teyliom Group, earning a 3.1x return on its investment. Cauris originally invested 600 million CFA in the company in 2008, making a follow on investment two years later of 400 million CFA.

At the venture end of the private equity investment scale, Silvertree Capital has backed Carzar, an online marketplace for the second-hand car market, in an undisclosed deal. The company offers a solution that addresses a large market, tapping into and improving an existing customer need without having to spend significantly on marketing to change customer behavior. This large market, with an attractive economic profile, a strong management team and significant traction were all key factors in Silvertree's decision to back the company.

Finally, for some interesting perspective last week, The New York Times Dealbook column follows Abraaj's Khawar Mann as he explores opportunities to develop private healthcare in Africa and other emerging markets, getting a better understanding of the leading private equity firm's approach as well as some of the typical challenges investors encounter. It's a good read.

As always, you can review these and other stories by scrolling down and clicking through to them below.  

Abraaj takes a minority stake in Indorama Fertlizers
Image Credit: Indorama Fertilizers
Deal News...
Private Equity
Abraaj takes minority stake in Indorama  
Emerging markets private equity firm The Abraaj Group is acquiring a minority stake in Indorama Fertilizers, the largest manufacturer of urea-based fertilizers in sub-Saharan Africa from a subsidiary of Indorama Corporation, a rapidly growing global petrochemical company with operations in Asia, Africa, north America and Europe.
Private Equity
MCP II backs private Moroccan university
Mediterrania Capital Partners, an Africa-focused private equity fund manager, is taking a significant minority stake in Université Privée de Marrakech (UPM) through MCP II, its second, €120 million fund which closed in August 2015. The stake was acquired from UPM's founder, Mohammed Kabadj.
Private Equity
Catalyst backs generics manufacturer Zenufa  
Nairobi-based Catalyst Principal Partners announced it is taking a controlling stake in Zenufa Laboratories, a Tanzanian pharmaceutical manufacturer, last week. The holding, which was undertaken through the East Africa-focused private equity managers $125 million Catalyst Fund I, was acquired from Zenufa's founders.
Private Equity
Cauris exits two financial services companies  
Cauris Management, the first regional private equity fund manager established in Francophone West Africa announced full exits from two financial services portfolio holdings at the end of September, namely Atlantic Business International and Bridge Bank Group Côte d'Ivoire. 
Private Equity
Synergy Capital backs Vester for seventh deal  
West Africa-focused investor Synergy Capital Managers announced the seventh deal for its $100 million private equity fund last week, making an undisclosed investment in Vester Oil Mill, one of Ghana's largest seed oil mill operators. 
Private Equity
AOG exits 75% of its stake in Addax Bioenergy
AOG, a privately-owned investment group, has exited a significant portion of its holding in Addax Bioenergy by transferring 75.1% of the company to a group of investors led by Sunbird Bioenergy Africa. AOG will retain 24.9% holding in the sugarcane bioethanol and renewable power operation in Sierra Leone, with Sunbird Bioenergy's capital injection taking the project to full commercial operation.
Venture Capital
Silvertree backs local auto marketplace Carzar
Silvertree Capital, the investment arm of Silvertree Internet Holdings, has invested in another South African startup. Carzar, an online marketplace for the second-hand car market, provides its users with a secure, convenient way to see their previously-owned vehicles.
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Sectors & Strategies...
Investing in private healthcare in Africa 
The New York Times Dealbook column follows Abraaj's Khawar Mann as he explores opportunities to develop private healthcare in Africa and other emerging markets, getting a better understanding of the leading private equity firm's approach as well as some of the typical challenges investors encounter.
Companies, People & Profiles...
People
Nonnie Wanjihia to join Emerging Capital Partners  
After three years spent setting up and leading the East Africa Venture Capital and Private Equity Association or EAVCA, Nonnie Wanjihia is moving to private equity firm Emerging Capital Partners to take up a senior communications role. She begins as a VP of Investor Relations in November and will continue to be based in Nairobi.
People
Kaberuka joins Centum's board  
Among the changes to Centum's board announced last week, former African Development Bank President Donald Kaberuka is joining the Nairobi-based investment company's body of independent directors. He will be one of four non-executive directors overseeing the Nairobi Stock Exchange-listed company.
People
Diamond becomes interim chair of Atlas Mara  
Atlas Mara's Board of Directors has appointed the firm's co-founder Bob Diamond to be the board's interim Chairman once Arnold Ekpe steps down from the role when his 3-year term ends in early December. 
Profile
Seattle's Capria backs fund managers in emerging nations  
Capria Ventures, a Seattle-based impact investment firm, runs an accelerator program to help fund managers in emerging markets invest and support businesses in their home countries. 
Current Job Postings...
Highlighted Job...             
Executive Director at EAVCA 
Based in Nairobi, Kenya
Director, Project Finance at Africa50 
Based in Casablanca, Morocco
Investment Principal at CrossBoundary  // crossboundary.com
Based in Nairobi, Kenya
Environment & Sustainable Development Manager  // platinumpower.ma
Based in Rabat, Morocco
Emerging Markets Investment Bankers at Nexus Capital  // linkedin.com
Based in New York, United States
Analyst at Pinebridge Private Funds Group  // pinebridge.com
Based in New York, United States
Chief Operating Officer at Capital Connect  // linkedin.com
Based in Johannesburg, South Africa
Investment Director, Infrastructure for investment firm  // efinancialcareers.com
Based in Lagos, Nigeria
Director, Acquistions for private investments firm  // greenwichpartners.co.uk
Based in London, United Kingdom
Associate, Governance & Citizen Engagement at Omidyar  // omidyar.com
Based in Johannesburg, South Africa
New to AfCD this week...
Investment Manager at Opes Impact Fund  // linkedin.com
Based in Nairobi, Kenya
Investment Associate, West Africa at Accion Venture Lab  // accion.com
Based in Lagos, Nigeria or Accra, Ghana
Associate for Africa-focused Private Equity firm  // efinancialcareers.com
Based in Paris, France
Upcoming Conferences...
Highlighted Event...             
Investing in African Mining Indaba 
Cape Town, February 6th to February 9th, 2017 
META Projects 2016 
Dubai, October 24th to October 26th, 2016 
8th Africa PPP Conference & Showcase 
London, October 24th to October 26th, 2016 
Sub-Saharan Africa Power Forum 2016
Cape Town, October 26th to October 28th, 2016 
International Islamic Banking Summit Africa 
Djibouti, November 2nd to November 3rd, 2016 
Africa Renewable Energy Forum 
Marrakech, November 2nd to November 4th, 2016 
3rd Annual Infrastructure Project Financing Africa
Nairobi, November 7th to November 9th, 2016 
Investing in Emerging Markets Summit 
Johannesburg, November 16th to November 17th, 2016 
African Agri Investment Indaba 
Cape Town, November 28th to November 30th, 2016 
SuperReturn Africa 
Cape Town, November 29th to December 1st, 2016 
14th Annual African Capital Markets Conference 
Cape Town, November 30th to December 1st, 2016 
Global Solutions Summit 2016 
Little Rock, December 13th to December 14th, 2016 
2017 Events...
SAVCA Private Equity in Southern Africa 
Stellenbosch, February 22nd to February 23rd, 2017 
Pensions Funds & Alternative Investments Africa 
Balaclava, Mauritius, March 15th to March 17th, 2017 
And finally...
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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