Last week in brief...In terms of size, the biggest volumes of capital to be found in Africa last week were among the fundraising crowd. AfricInvest provided us with the biggest - holding a final close for its North African-focused private equity fund, Maghreb Private Equity Fund IV. The African Development Bank became the latest multilateral development institution to commit capital to the fund, investing €20 million as part of the final round of fundraising.
The fund's strategy is to take minority stakes in businesses in Tunisia, Morocco, Algeria and Egypt. The 10-year, closed-end fund will prioritize its growth capital investments for companies that are well-established in their local markets and which have the potential to scale their activities to a regional level. While nominally sector-agnostic, the sectors most likely to match these criteria best include IT and Telecoms, FMCG, healthcare, education, logistics, agribusiness and a broad range of services such as financial services and business processing.
On the sidelines of the Africa 2018 Summit in Sharm El Sheikh this past weekend, Sawari Ventures announced the first close of Sawari Ventures North Africa Fund I, garnering commitments totaling 50% of the fund's final goal.
The fund will target opportunities in what it describes as technology and knowledge driven companies in Egypt, Tunisia and Morocco. Specific sectors of interest include ICT, Deep Technology, FinTech, Education Technologies, HealthTech, and Renewable and Green Energy which will be backed in deals averaging $1.5 million in size. Ultimately the fund is aiming to build up a portfolio of approximately 25 growth stage companies.
FinDev Canada has become the first North American development finance institution to commit capital to Climate Fund Manager's Climate Investor One. The recently-launched Canadian DFI is investing $20 million in the facility's Construction Equity Fund, one of three interlinked funds that finance the different stages of a project.
With this investment, Climate Investor One has now raised $555 million of the $1 billion it is ultimately looking to land. The capital will invest in renewable energy projects, focusing on solar, wind and run-of-river hydro developments that will have the capacity to generate between 25MW and 75MW of power. While 40% of of the fund is likely to be invested in Africa, the fund will also source investments in Asia and Latin America.
Vantage Capital's mezzanine deal for Pétro Ivoire last week has enabled Amethis Finance and the West African Emerging Markets Growth Fund to exit their stakes in the Ivorian oil and gas distributor. The South African mezzanine debt manager is the capital to allow Pétro Ivoire's founding family to acquire stakes held by Amethis Finance and the West African Emerging Markets Growth Fund and regain control of the firm. The deal is one of the first Leveraged Management Buyouts to be structured in Francophone Africa. Geogas Entreprises, a French-based gas trading company, is also buying part of the private equity firms' stakes, and taking a holding in the Pétro Ivoire alongside the Kadio-Morokro family.
The transaction is the ninth for Vantage's $288 million third fund, and is expected to yield about 10% before any equity upside. Pétro Ivoire is one of the top 3 distributors of oil and gas products in Côte d’Ivoire, selling oil, bottled gas as well as lubricants under its own brand.
TLG Capital's Credit Opportunities Fund is investing debt in Atlas Mara, the pan-African banking platform set up by high-profile bank CEO Bob Diamond. The deal gives TLG Capital a broader exposure to Nigeria, an important market for the investment firm. Atlas Mara's biggest asset is its stake in Union Bank of Nigeria, which, following recent reforms by Nigeria's government, looks set to benefit from the growth in credit and consumer activity in the West African country.
There were a trio of interesting venture deals last week. In the first, the IFC is investing equity in Vezeeta, a digital healthcare company headquartered in Cairo. The development finance institution is investing $1 million in the company as part of a $12 million round that Vezeeta recently raised from several investors led by Saudi Technology Ventures. Others taking part included existing investors BECO Capital, Vostok New Ventures and Silicon Badia, as well as first-time investor CCE Ventures.
In the second, we head to the other end of the continent. Snapt, a South Africa-based application delivery controller business, has closed its Series A round with commitments from Convergence Partners, Nedbank and Sanari Capital. Between them, the three investors are investing $3 million into Snapt, which will be used to boost the firm's sales and marketing efforts around the world as well as fund some key research and development initiatives. Convergence, who first backed the company with $1 million in mid-2016, is a return-investor for this round, whilst Nedbank and Sanari Capital are backing the firm for the first time.
And finally, TLcom Capital's TIDE Africa Fund announced it has made its fifth investment since it held its first close last year, cementing its position as the most active venture fund on the continent. The fund is participating in an IFC-led seed round for Kobo360, a digital logistics platform which matches truck owners with cargo owners who have long-haul freight needs. The other members of the investment group include Silicon Valley investors WTI, Y-Combinator, Sequoia Scout, and African investors Cardinal Stone Partners, Chandaria Capital, and Verod Futures.
That's it for this week. As always, you can review these and other stories by clicking through to this week's preview edition of the newsletter.
Allan Cunningham is a senior media executive who has spent the last 15 years of his career working for some of the world’s most respected M&A and Private Equity media companies including Dow Jones’s publications Private Equity Analyst and VentureWire and most recently, The Deal. He has built a number of successful digital and event content businesses, both subscription and sponsor-supported, delivering information and content-marketing services to clients in the M&A and broader deal ecosystem. He recently struck out on his own and launched Rowayton Press, a multi-platform media company focused on the private capital opportunities in emerging and frontier markets. Mr. Cunningham holds a Bachelors degree from Liverpool John Moores University in the UK.