April 3rd, 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...             
Bonds & Sukuk
The Week in Brief...
Fund raising news dominated the headlines in Africa's private capital world last week. Both fund launches and partial closes. And in various shapes and sizes for various asset classes.

The biggest private equity fund making news last week came courtesy of Catalyst Principal Partners. The Nairobi-based fund manager held a first close for its second fund, touching $103 million in commitments from a mix of Africa-focused fund-of-funds, development finance institutions and regional family offices. All had been investors in the fund's $123 million predecessor fund, with a number of them reportedly increasing the size of their commitment to the new vehicle.

Catalyst Fund II is targeting $175 million for a final close, which it anticipates will take place later this year. The 10-year fund will pursue a similar strategy to that executed by Catalyst Fund I, making mid-market growth capital investments within fast growth consumer demand driven sectors across Eastern Africa.

Pan-African asset management firm Enko Capital is launching a $200 million bond fund which will invest in Africa debt instruments denominated in both hard and local currencies. The new fund is the third investment vehicle for Enko, adding a fixed income product to its offering which, until now, has featured a private equity fund and a listed equity fund.

It's hoped that the fund will attract commitments from foreign investors keen to expand their exposure to the higher yields available on the continent. The fund will back both sovereign and corporate debt issues across the continent, with the exception of South Africa.

Brian Joffe, who founded Bidvest in 1988, is listing Long4Life, an investment firm with an expected capitalization of R2 billion (about $150 million) on the Johannesburg Stock Exchange at the end of this week. The investment company will not be raising any additional capital after the listing date, according to the SENS announcement.

Broadly speaking, Long4 Life will back both listed and unlisted consumer sector-oriented companies or ones which the firm describes as having a "lifestyle" focus. It will steer clear of banking, mining and resources opportunities. The investment vehicle aims to deliver annualized growth in excess of 15% over the medium-to-long term. 

Amethis, I&P and Partech Ventures are all in line for a capital commitment to the funds they're raising from the European Investment Bank. In statements on the EIB's website, the EU's development finance institution is mulling whether to invest a total of €50 million in the three private equity funds, all of which are focusing on opportunities within the SME sector, predominantly in the sub-Saharan region.

In deal news last week, Africa-focused private equity firm, 8 Miles is making the eighth investment for its first fund by acquiring a significant minority interest in Blue Skies, a UK-incorporated tropical fruit business with operations in several African countries.  While financial terms of the deal were not disclosed, the fund typically puts between $15 million and $45 million to work in each investment.

One of the companies in 8 Miles' existing portfolio received an additional capital infusion last week. Verde Beef Processing, which 8 Miles backed in early 2016, is the beneficiary of Norfund's first investment in Ethiopia. The deal, which was led by Kjartan Stigen, Norfund's Regional Director for East Africa, is a $7.4 million convertible debt investment and grants the Norwegian DFI an observer seat on the company's board. Should full conversion of the debt occur, that seat would become a full seat.

In venture capital investment news, KNF Ventures, the section 12J Venture Capital Company launched by Knife Capital in early 2016, is backing Quicket, an online ticketing solutions company, in an undisclosed deal. The capital will be used to support the company's plans to streamline its service offering in South Africa as well as its plans to expand to other select countries on the continent. A significant portion of the KNF investment will be allocated to fine-tuning Quicket's mobile ticketing solution and developing a scalable mobile ticket kiosk to build a physical distribution network in Africa.

In an article in the Financial Times, Imaduddin Ahmed, a PhD student at University College, London, discusses how off-grid solar has taken the crown to be the latest leapfrog infrastructure technology from the mobile phone. He explores the impact the technology is having in Rwanda as well as the challenges and risks investors face in building their businesses.

Last week, the London Stock Exchange, in partnership with a number of other organizations, launched its report "Companies that Inspire Africa 2017." This is the first edition of the publication, which identifies 343 private companies from 42 African countries considered to be the continent's most dynamic and exciting small businesses. It will be interesting to take a look.

And finally, a couple of job change items were reported last week. In the first, Daniel Kamau is succeeding Luke Kinoti as Chief Executive Officer of Fusion Capital, the East African private equity and real estate investment firm. Kinoti, who has been the firm's CEO since 2006 when he co-founded the firm with Philip Goodwin, is retiring from the role and will pursue other business interests.

And in the second, Joseph Nnanna, the Deputy Governor of the Central Bank of Nigeria is taking over the role of Chairman of the Africa Finance Corporation from Sarah Alade, who is retiring. A well-respected Economist and Banker, Dr. Nnanna's career spans more than 30 years, and has included periods spent as an advisor to several leading institutions including the United Nations Conference on Trade and Development, the Government of Nigeria as well as serving on the Board of the International Monetary Fund. He was appointed to the Board of the Central Bank of Nigeria in February 2015.

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

8 Miles takes a significant minority stake in tropical fruit business Blue Skies
Image Credit: Blue Skies
Deals News...
Private Equity
8 Miles takes significant minority stake in Blue Skies
Africa-focused private equity firm, 8 Miles is making the eight investment for its first fund by acquiring a significant minority interest in Blue Skies, a UK-incorporated tropical fruit business with operations in several African countries. Financial terms of the deal were not disclosed.
Private Equity
Norfund backs Verde Beef with $7.4 mln
Norfund, the Norwegian government's development finance institution, is making its first investment in Ethiopia, backing Verde Beef Processing, an integrated beef producer with $7.4 million. The capital will be used to fund the completion of the construction of an abattoir and meat processing facility and pride the business with working capital.
Venture Capital
Knife Capital's 12J VC firm backs Quicket
KNF Ventures, the section 12J Venture Capital Company launched by Knife Capital in early 2016, is backing Quicket, an online ticketing solutions company, in an undisclosed deal. The capital will be used to support the company's plans to streamline its service offering in South Africa as well as its plans to expand to other select countries on the continent.
Funds & Fundraising...
Private Equity
Catalyst holds $103mln first close for Fund II
Catalyst Principal Partners has held the first close for it second private equity fund, Catalyst Fund II, landing $103 million in commitments from a mix of Africa-focused fund-of-funds, development finance institutions and regional family offices. All of them had been investors in the fund's $123 million predecessor fund, with a number of them increasing the size of their commitment to the new vehicle.
Private Debt
Enko Capital Launches $200mln debt fund
Enko Capital is launching a $200 million bond fund which will invest in Africa debt instruments denominated in both hard and local currencies. The new fund is the third investment vehicle for Enko, adding a fixed income product to its offering which, until now, has featured a private equity fund and a listed equity fund.
Private Equity
BidVest Founder to list $150mln investment firm
Brian Joffe, who founded Bidvest in 1988, is listing Long4Life, an investment firm with an expected capitalization of R2 billion (about $150 million) on the Johannesburg Stock Exchange at the end of this week. The investment company will not be raising any additional capital after the listing date, according to the SENS announcement published last week.
Private Equity
EIB mulls Amethis, I&P and Partech fund commitments
The European Investment Bank is mulling a total of €50 million or $53 million in capital commitments for three-Africa focused private equity funds. The funds, being sponsored by Amethis Finance, Investisseurs & Partenaires and Partech Ventures, are all focusing on opportunities within the SME sector, predominantly in the sub-Saharan region.
This week's issue supported by...             
Projects & Portfolio Companies...
Consumer
Danone looks to acquire Brookside's Tanzanian subsidiary
Danone is looking to acquire Brookside Dairy's Tanzanian subsidiary. The French food group advised Tanzania's Fair Competition Commission of its plans which come three years after the company first acquired a 40% stake in parent company Brookside Dairy in 2014. Emerging markets private equity investment firm The Abraaj Group holds a 10% stake in Brookside which it first backed in 2009.
Sectors & Strategies...
Solar
Off-Grid solar is "the leapfrog infrastructure of the decade"
Off-Grid solar systems have taken the crown to be the leapfrog infrastructure technology from the mobile phone. Imaduddin Ahmed, a PhD student at University College, London, explores the impact the technology is having in Rwanda as well as the challenges and risks investors face in building their businesses.
Infrastructure
PPPs for East Africa's roads network
A summary of discussions that took place at a conference hosted by KPMG and Gowling WLG on the current state of several roads projects in East Africa and the technical, financial and legal issues facing PPPs in the region.  
Trends & Perspectives...
Perspectives
OPIC's Africa Chief highlights institution's role in energy projects
In an interview with ESI Africa, Subha Nagarajan, OPIC's Managing Director for Africa outlines the development finance institution's role in financing and insuring energy projects on the continent, highlighting some of the more high-profile and describes what he sees as an outlook for financing the continent's power projects.
Perspectives
LSE publishes list of Africa's most promising private companies
The London Stock Exchange, in partnership with a number of other organizations, launched its report "Companies that Inspire Africa" at the end of last week. The publication identifies 343 private companies from 42 African countries which it considers to be the continent's most dynamic and exciting small businesses.
Perspectives
Africa is the next frontier for VCs
Ali Diallo writes in Venturebeat on how VCs should follow Peter Thiel's advice to entrepreneurs to "follow hidden paths" to find winning opportunities. Africa is one such hidden path, and where obstacles can actually be golden opportunities in disguise.
This week's issue supported by...             
AfCD 2017 SSA Guide Promo
The essential 2017 Guide to sub-Saharan Africa's
Key Private Equity Investors
 
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Companies, People & Profiles...
People
Kamau takes over as CEO of Fusion
Daniel Kamau is succeeding Luke Kinoti as Chief Executive Officer of Fusion Capital, the East African private equity and real estate investment firm. Kinoti, who has been the firm's CEO since 2006 when he co-founded the firm with Philip Goodwin, is retiring from the role and will pursue other business interests.
People
Nnanna becomes Chair of AFC
Joseph Nnanna, the Deputy Governor of the Central Bank of Nigeria is taking over the role of Chairman of the Africa Finance Corporation from Sarah Alade, who is retiring. As well as being the AFC's Chair, Alade served on the Board of the Central Bank of Nigeria for 10 years, most recently as its Deputy Governor of the Economic Policy Directorate. 
Upcoming Investment Missions...
African Agri Council's Investor Discovery Trade Mission and Technical Tour
3 dates in 3 cities

London, May 23rd to May 25th, 2017
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To request an invitation for any of these dates, please send an email to Julia Barton-Hill.
Current Job Postings...
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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.
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Chief Operating Office at Africa50  // africa50.com
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Upcoming Conferences...
Highlighted Event...             
TMT Finance Africa 2017 
London, May 24th, 2017 
14th Annual AVCA Conference 
Abidjan, April 4th to April 5th, 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 
African Nordic Business Conference 2017 
Helsinki, May 4th, 2017 
Euromoney Kenya Conference   // euromoney.com
Nairobi, May 9th, 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 
East Africa Real Estate Investor Forum 2017 
London, June 8th, 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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