The
weekly roundup of Africa's Private Capital news
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Here's this week's wrap of the most interesting Africa-related private equity, infrastructure and venture capital deal stories, market opinion articles and information pieces.
Thank you being a reader and we look forward to continuing to keep you informed on the private capital investment themes, deals and fund raises in Africa.
As always, we'd be delighted if you shared it with any interested colleagues and/or business partners. If they would like to receive their own weekly copy in 2017, they're more than welcome to sign up here.
Finally, 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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Private equity giant
Carlyle Group's sub-Saharan Africa Fund made its latest investment last week, agreeing to buy a significant stake in
GCR, Africa's largest credit rating agency, from the management founders and
DEG, the German development finance institution. Once the transaction completes, Carlyle will be GCR's largest shareholder, owning approximately half the equity in the company.
GCR's founders and DEG both remain invested in the business, which now serves 400 customers across 20 countries from its headquarters in South Africa and operations across the continent. The company is the largest provider of credit ratings in Africa, providing a range of analysis and rating services to insurance companies, financial institutions, corporations, public service entities and structured finance providers.
In infrastructure investment news,
GAIA Infrastructure Capital, an infrastructure investment holding company is acquiring a 25.2% stake in the
Dorper Wind Farm in South Africa's Eastern Cape for approximately $37 million. The wind farm, which has been fully operational since 2014, has a generating capacity of approximately 98MW which it sells on to state-owned energy provider Eskom through a 20-year power purchase agreement. The deal is GAIA's first since it debuted as a SPAC on the
Johannesburg Stock Exchange in late 2015.
On the fundraising front,
AfricInvest has teamed up with
Bpifrance to launch the French African Fund, a cross-border investment fund that will target opportunities in small and medium-sized business in both France and Africa. An as yet undisclosed amount of capital has been raised from a diverse group of investors in both France and Africa.
These include Bpifrance itself as well as French development finance institution
Proparco, French bank
Société Générale and mobile telecoms firm
Orange. More than 25% of the commitments have come from African investors including the
Caisse Nationale de Prévoyance de Côte d'Ivoire,
Saham, the Moroccan insurance company,
Financecom, the Moroccan industrial and financial group, the
Central Bank of Kenya's pension fund as well as a number of private investors from Kenya and Nigeria.
The fund aims to take minority equity stakes in mid-cap companies in France and Africa with potential to deliver significant growth. In addition to providing capital, AfricInvest will support portfolio company growth in each region, helping French firms expand into Africa and African firms to expand into France and the broader European region.
In impact investment news,
FMO, the Dutch development bank is investing $15 million in the SANAD Fund for MSME, a debt and equity impact fund advised by
Finance in Motion that targets opportunities in the Middle East and North Africa. The capital, which is being invested in the debt sub fund, will be used for on-lending initiatives via SANAD's local partners to businesses in the region's micro, small and medium enterprise sector.
Rocket Internet Capital Partners Fund, a significant global internet fund, held its final close last week, raising $1 billion for early stage and growth equity investment opportunities. Managed by
Rocket Internet, which holds a stake in e-commerce company
Africa Internet Group, the owner of a number of African e-commerce businesses through the
Jumia platform, the fund will continue to back high-growth, internet-related businesses with the new fund, focusing on opportunities in key internet sectors including marketplaces, e-commerce, financial technology, software and travel.
There were a number of items on individual company strategies of interest to Africa-focused private capital investors last week. All three were reported by
Bloomberg during the World Economic Forum which was taking place in Davos. Firstly, India's largest mobile-phone operator
Bharti is looking to sell or merge some of its Africa operations in a bid to reduce the company's $12 billion debt load and help its largest overseas acquisition achieve profitability. Some of Bharti's businesses in as many as 15 African countries would be affected by the moves, which could be completed within a year.
The other two items concerned the financial services sector. Sources tell
Bloomberg that
Atlas Mara is considering a number of strategic options, including taking the sub-Saharan financial services investment vehicle private. The move is driven by a need to revive investor confidence in the LSE-listed company, whose value has fallen by over 80% since it first listed over 3 years ago. And, in an interview with
Bloomberg,
Abraaj's CEO Arif Naqvi indicated that the growth markets private equity firm would still consider acquiring a stake in
Barclays Africa should "...the opportunity re-present itself".
And finally, whilst analyst forecasts of global output in 2017 point to mediocre growth, a number of surveys report that institutional investor interest in the alternative investment asset classes is on the rise. Of these, private equity remains the sector of most interest, with 56% of those surveys indicating they are looking to increase their allocation to private equity over the long term. Let's hope Africa features as part of those plans.
As always, you can review these and other stories by scrolling down and clicking through to them below.
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GAIA Infrastructure Capital takes a 25%stake in Dorper Wind Farm in South Africa's Eastern Cape |
Private Equity
Carlyle takes 50% stake in African ratings agency
The Carlyle Group has agreed to buy a significant stake in GCR, Africa's largest credit rating agency, from the management founders and DEG, the German development finance institution. Once the transaction completes, Carlyle will be GCR's largest shareholder, owning approximately half the equity in the company. Additional terms of the deal were not disclosed.
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Infrastructure Private Equity
GAIA spends $37mln for 25% Dorper Wind Farm stake
GAIA Infrastructure Capital, an infrastructure investment holding company which started life as a special purpose acquisition vehicle or "SPAC" listed in the Johannesburg Stock Exchange in late 2015, has made its first transaction, acquiring a 25.2% stake in the Dorper Wind Farm in South Africa's Eastern Cape for approximately $37 million.
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Private Equity
d.light raises 10.5mln in equity and grants
Solar lighting and power products company d.light has raised $10.5 million in equity and grants from Norfund, Beyond the Grid and the Shell Foundation. The latest funding brings the total amount raised by the off-grid solar company in the last four months to more than $40 million.
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Fund & Fundraising News...
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Private Equity
AfricInvest and Bpifrance launch French African Fund
Africa-focused private equity fund manager AfricInvest has teamed up with Bpifrance to launch the French African Fund, a cross-border investment fund that will target opportunities in small and medium-sized business in both France and Africa.
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Private Equity
Rocket holds $1bln final close for global internet fund
Rocket Internet announced that it held the final close for its global internet fund last week, raising $1 billion for early stage and growth equity investment opportunities from a diverse group of institutional investors including financial institutions, pension funds, asset managers, foundations and high net worth individuals. About 14% of the commitments to the fund have been made on Rocket Internet's own account.
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Private Equity
FMO backs SANAD fund with $15mln
FMO, the Dutch development bank is investing $15 million in the SANAD Fund for MSME, a debt and equity impact fund advised by Finance in Motion that targets opportunities in the Middle East and North Africa. The investment is being made through the MASSIF Fund which is managed by FMO on behalf of the Dutch Ministry of Foreign Affairs.
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This week's issue supported by...
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Financial Services
Abraaj still eyeing Barclays Africa
In an interview with
Bloomberg at the World Economic Forum in Davos last week, Abraaj's CEO, Arif Naqvi indicated that the growth markets private equity firm would still consider acquiring a stake in Barclays Africa should "...the opportunity re-present itself".
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Financial Services
Atlas Mara mulls strategic options
Sources tell
Bloomberg that Atlas Mara is considering a number of strategic options, including taking the sub-Saharan financial services investment vehicle private. The move is driven by a need to revive investor confidence in the LSE-listed company, whose value has fallen by over 80% since it first listed over 3 years ago.
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Telecomms
Bharti looks to offload African assets
India's largest mobile-phone operator is looking to sell or merge some of its Africa operations in a bid to reduce the company's $12 billion debt load and help its largest overseas acquisition achieve profitability. Bharti Airtel's Chairman told
Bloomberg that some of Bharti's businesses in 15 countries would be affected by the moves, which could be completed within a year.
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Trends
Fintech startups top African VC 2016 funding league
Over the course of 2016, 146 African startups raised a total of $129 million in venture funding, an increase in volume of 16.8% when compared with the prior year. That's according to data released by Disrupt Africa, a news website, which also found that whilst the volume of venture deals was up, the overall value in fact decreased. The fintech sector proved the most popular for venture investors, garnering almost 25% of the capital invested during the year.
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Trends
Global Investors ratchet up private equity exposure
Whilst analyst forecasts of global output in 2017 point to mediocre growth, a number of surveys report that institutional investor interest in the alternative investment asset classes is on the rise. Of these, private equity remains the sector of most interest, with 56% of those surveys indicating they are looking to increase their allocation to private equity over the long term.
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Based in Brussels, Belgium
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Based in Dubai, United Arab Emirates
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Based in Dubai, United Arab Emirates
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Based in Dubai, United Arab Emirates
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SAVCA Private Equity in Southern Africa
Stellenbosch, February 22nd to February 23rd, 2017
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Regional Energy Co-operation Summit
Abidjan, January 25th to January 27th, 2017
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Growing Economies: Project Finance Forum
Cape Town, February 2nd to February 3rd, 2017
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Investing in African Mining Indaba
Cape Town, February 6th to February 9th, 2017
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Africa Finance & Investment Forum
Nairobi, February 13th to February 16th, 2017
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Pensions Funds & Alternative Investments Africa
Balaclava, Mauritius, March 15th to March 17th, 2017
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Africa Financial Services Investment Conference 2017
London, May 3rd to May 5th, 2017
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19th Annual Africa Energy Forum
Copenhagen, June 7th to June 9th, 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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