March 13th, 2017
The  weekly roundup of Africa's Private Capital news


  

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 acunningham@africacapitaldigest.com
This week's issue supported by...             
The Week in Brief...
Fundraising news for Africa-focused or Africa-related private equity funds attracted a lot of attention last week. But then, so did news of a maiden African investment by a significant US-based private equity firm. Compared to the previous couple of weeks, there was a lot of activity to report.

Let's start with the private equity firm and its maiden Africa investment. The firm in question is TA Associates , a global growth investor headquartered in Boston which announced it has acquired a minority stake in Interswitch, the Nigerian digital payments company, from Helios Investment Partners in an undisclosed deal. Founded in 2002, Interswitch enjoys significant market share in Nigeria, owning and operating Verve, the country's principal domestic credit card scheme, and serving as a third-party transaction processor for many of the country's largest banks.

On to fund raising, there was one launch announcement and three significant closes last week. The launch announcement sees Mediterrania Capital Partners kick off fund raising for its third fund, looking to raise €250 million to invest in companies in North Africa as well as a select number of sub-Saharan countries. MCP III is a significantly larger fund than either of its two predecessors and is t argeting an IRR in excess of 25%.

The biggest fund close of the week came from Actis who managed to hit the $2.75 billion hardcap for its fourth energy fund in record time. The fund, which was significantly oversubscribed, will invest in select countries in Latin America, Africa and Asia, building four regional platforms, one of which, Azura, has a pan-African focus. Much larger than its predecessor fund, Actis Energy 4 was raised by the firm's in-house team, with a number of sizeable reups as well as new commitments.

In the other fund close story of the week, Apis Partners, a private equity manager that targets growth capital opportunities in financial services companies in Africa and Asia, announced the final close for their first fund, handily beating their $250 million target with $287 million in commitments. Apis Growth Fund I will target investments that need between $20 million and $40 million of capital has already deployed $130 million in capital in 5 deals since it held its first close in August 2015. It expects to add another 5 investments to the fund's portfolio over the next couple of years.

For the smaller end of the deal spectrum, the Accion Frontier Inclusion Fund, managed by Quona Capital, announced that it has received commitments totaling $141 million for its final close. The fund will target investments in small, innovative companies that aim to provide financial services to underserved consumers and businesses. 

In other deal news, an investor consortium made up of CDC, the IFC, Maris Capital and Mbuyu Capital Partners are jointly investing $48 million in Africa Logistic Properties, a newly-established developer and manager of Grade A warehousing. In committing $25 million to the deal, CDC is providing the lion's share of the investment.

Sea Harvest, the South African fishing company majority-owned by Brimstone Investments, is looking to raise up to $100 million by floating 38.7% of its share capital on the Johannesburg Stock Exchange. The date of the listing has been set for March 23rd.  The firm will use the proceeds to pay down debt and fund the its acquisition strategy as it seeks to become a global diversified seafood business. Following the listing, Brimstone still plans to retain a majority stake in the company.

Making its fourth investment on behalf of the Fund for Agriculture Finance in Nigeria or FAFIN, Sahel Capital is teaming up with CardinalStone Capital Advisers to acquire an undisclosed stake in Crest Agro Products, an integrated cassava processor. The capital will be used to support the establishment of the company's starch processing facility as well as help expand its farming activities.

Heading North East to Egypt, the African Finance Corporation is backing Carbon Holdings, a privately-held Egyptian petrochemicals company, with $25 million in a quasi-equity deal. The capital, which is being invested alongside capital commitments from the IFC and Gulf Capital, will be used by Carbon Holdings to expand its operations.

There were a couple of other DFI-related items last week. Once again, Africa Finance Corporation featured, announcing the successful $350 million financial close for an 80MW peat-to-power project in Rwanda's Gisagara district. AFC is the Mandated Lead Arranger for the project's debt, which was also supported by Finnfund, Afreximbank and others. And DEG, the German DFI announced a $7.6 million investment in Retailability, a retailer of low price fashion clothing and footwear to a young customer demographic, with a chain of 200 stores in Southern Africa.

Finally, some interesting perspective was on offer in other publications. Euromoney finds that a lack of fintech innovation and funding coming into the continent to support a sustained level of fintech growth is forcing Africa's banks and telcos to play a much bigger role in the development of technologies than in the US and Europe. And Africa's economics and changing consumer patterns are fueling considerable interest in real estate investment opportunities from many European institutional investors, but not all.  Investments & Pensions Europe takes a look at this market, its opportunities and challenges.

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

TA Associates makes maiden Africa deal with minority investment in Interswitch, the operator of Quickteller
Deals News...
Private Equity
TA Associates' Interswitch stake marks debut Africa deal
TA Associates, the Boston-headquartered private equity firm is making its first Africa-related investment and acquiring a minority stake in Interswitch. The stake was acquired from Helios Investment Partners, who remains the majority shareholder of the Nigerian digital payments and ecommerce company. Additional financial terms of the deal were not disclosed.
Private Equity
Investors back Africa Logistics Properties with $48mln
An investor consortium made up of CDC, the IFC, Maris Capital and Mbuyu Capital Partners are jointly investing $48 million in Africa Logistic Properties, a developer and manager of Grade A warehousing. The capital will be used to support the company's warehousing developments in Nairobi, which suffers from a lack of quality, international-standard warehousing space.
Private Equity
Sahel Capital backs Crest Agro in undisclosed deal
Making its fourth investment on behalf of the Fund for Agriculture Finance in Nigeria or FAFIN, Sahel Capital is teaming up with CardinalStone Capital Advisers to acquire an undisclosed stake in Crest Agro Products, an integrated cassava processor. The capital will be used to support the establishment of the company's starch processing facility as well as help expand its farming activities. 
Private Equity
AFC backs Carbon Holdings with $25mln
The African Finance Corporation is backing Carbon Holdings, a privately-held Egyptian petrochemicals company, with $25 million in a quasi-equity deal. Additional terms of the transaction were not disclosed.  
Private Equity
DEG backs Retailability in $7.6mln equity deal
DEG, the German development finance institution, is backing Retailability with R100 million or $7.6 million in equity. The capital will be used to help the South African retailer expand its operations following its recent acquisition of fashion retailer, LEGIT.
Funds & Fundraising...
Private Equity
Actis' fourth energy fund hits $2.75bln at final close
Actis has announced it has reached the final close for its fourth energy fund, hitting its $2.75 billion hardcap within four months of the fund's initial close. The private equity fund, which was significantly oversubscribed, will invest in select countries in Latin America, Africa and Asia, building four regional platforms, one of which, Azura, has a pan-African focus.
Private Equity
Apis' first fund beats target to land $287mln
Apis Partners, a private equity asset manager that targets growth capital opportunities in financial services companies in Africa and Asia announced the final close for their first fund last week, handily beating their $250 million target to reach $287 million.
Private Equity
Mediterrania Capital targets €250 million for Fund III
Africa-focused private equity fund manager Mediterrania Capital Partners kicked off fundraising for its third fund last week. Mediterrania Capital Partners III is looking to raise €250 million to invest in companies in North Africa as well as a select number of sub-Saharan countries including Cameroon, Côte d'Ivoire and Senegal.
Private Equity
Accion and Quona raise $141mln for fintech fund
The Accion Frontier Inclusion Fund, managed by Quona Capital, announced that it has received commitments totaling $141 million for its final close, held last week. The investors backing the fund come from a wide range of institutions, including insurance companies, investment banks and asset managers, an endowment, some foundations and family offices as well as several development finance institutions.
This week's issue supported by...             
Bonds & Sukuk
Projects & Portfolio Companies...
Power
$350mln Rwandan power project reaches financial close
The Africa Finance Corporation has announced that financial close has been reached for the $350 million deal to finance an 80MW peat-to-power project in Rwanda's Gisagara district. The new power plant is projected to increase the country's installed generation capacity by 40%.
Agribusiness
Sea Harvest aims to raise $100mln in IPO
Sea Harvest, the South African fishing company majority-owned by Brimstone Investments, is looking to raise up to $100 million by floating 38.7% of its share capital on the Johannesburg Stock Exchange. The date of the listing has been set for March 23rd.
Financial Services
Atlas Mara is not up for sale
In a session that took place at last week's Investing in Africa conference hosted by the Wall Street Journal, Bob Diamond dismissed suggestions that Atlas Mara, the African banking platform he co-founded with Ashish Thakkar, could be sold.
Media & Entertainment
iflix gets $90mln to support Africa expansion
iflix, a private equity-backed video-streaming business serving the Southeast Asian market looks set to launch in Africa and the Middle East following a $90 million investment round led by Liberty Global and Kuwait-based mobile and data operator, Zain. A portion of the fresh capital will be used to support the firm's Africa expansion plans. 
Regulation & Compliance...
Regulation
Analysis of SARS private ruling 264 for VCCs
A look at some of the major principles and aspects of Ruling 264 issued by the South Africa Revenues Service in early February. Jerome Brink, a Partner with law firm Cliffe Dekker Hofmeyr, reviews the ruling and looks at its impact on the interpretation of rules governing 12J VCCs.
Trends & Perspectives...
Trends
Africa's fintech development path diverges from US and Europe
A lack of fintech innovation and funding coming into the continent to support a sustained level of fintech growth is forcing Africa's banks and telcos to play a much bigger role in the development of technologies than in the US and Europe.
Perspectives
European LP interest in Africa's real estate on the rise
Africa's economics and changing consumer patterns are fueling considerable interest in real estate investment opportunities from many European institutional investors, but not all.  Investments & Pensions Europe takes a look at this market, its opportunities and challenges.
Upcoming Investment Missions...
African Agri Council's Investor Discovery Trade Mission and Technical Tour
Starts  April 17th, 2017 in New York
To request an invitation, please send an email to Julia Barton-Hill
This week's issue supported by...             
AfCD 2017 SSA Guide Promo
The essential 2017 Guide to sub-Saharan Africa's
Key Private Equity Investors

Coming soon and available at 30% prepublication discount
 
Fresh dealflow, new clients, galvanized strategies...

Get the latest information on the private equity investors located in sub-Saharan Africa to fine tune your deal sourcing, client development strategies and more. Order your copy today and save 30% with the pre-publication discount. Time is limited, so act now and get ready to benefit from:
  • Profiles with Names, Emails of each firm's investment professionals
  • Details of active funds, preferred deal sizes, regional and sector preferences
  • Information on current portfolio companies and projects
  • Headquarter and Regional Office contact details
  • Expert insight on fund raising, due diligence, execution and exits
  • Quick reference indexes of fund managers and portfolio companies by sector
Order today, risk-free and lock in the pre-publication rate
Current Job Postings...
Reserve this position for your job ads...

AfCD counts the most active, dynamic and experienced Africa-focused investment professionals among its readers. Bolster your 2017 recruitment efforts by advertising your vacancies in this highlighted position to attract the very best applicants.
 Email Teresa Hall today to find out about rates and availability.
Investment Associate at LeapFrog Investments  // leapfroginvest.com
Based in London, UK
Investment Officer at the IFC  // ifc.org
Based in London, UK
Development Impact Executive for CDC's Impact Fund  // cdcgroup.com
Based in London, UK
Director, Industrial and Trade Development at AfDB  // afdb.org
Based in Abidjan, Côte d'Ivoire
Investment Anaylst at E Squared Investments  // thegiin.org
Based in Johannesburg, South Africa
New to AfCD this week...
Chief Operating Office at Africa50  // africa50.com
Based in Casablanca, Morocco
Vice President at Proterra Partners  // proterrapartners.com
Based in London, UK
Principal, Client Relations at IFC Asset Management Company  // ifc.org
Based in London, UK
Investment Manager at Britam Asset Managers  // britam.com
Based in Kampala, Uganda
Senior Investment Associate at Proterra Partners  // proterrapartners.com
Based in London, UK
Portfolio Analyst, Infrastructure at the IFC  // ifc.org
Based in Dubai, United Arab Emirates
Post Merger Integration Specialists at KPMG  // kpmg.com
Based in Johannesburg, South Africa
Upcoming Conferences...
Highlighted Event...             
14th Annual AVCA Conference 
Abidjan, April 4th to April 5th, 2017 
Pensions Funds & Alternative Investments Africa 
Balaclava, Mauritius, March 15th to March 17th, 2017 
New this week...
Euromoney Côte d'Ivoire Conference  // euromoney.com
Abidjan, March 28th to March 29th, 2017 
Bonds, Loans & Sukuk Africa 
Cape Town, April 5th to April 6th, 2017 
Africa Tech Summit 
London, April 20th, 2017 
Africa Financial Services Investment Conference 2017 
London, May 3rd to May 5th, 2017 
AFC Live 2017 
Abuja, May 15th to May 16th, 2017 
IFC & EMPEA's Annual Global Private Equity Forum 
Washington, DC, May 15th to May 17th, 2017 
TMT Finance Africa 2017 
London, May 24th, 2017 
19th Annual Africa Energy Forum 
Copenhagen, June 7th to June 9th, 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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