Last week in brief...Fittingly, given mounting global concerns over climate change, three of the transactions we report on in this, our first issue of 2020, involved renewable energy companies. In Malawi, Swiss impact investment firm responAbility is backing one of the country's first solar projects with equity. It's part of a $67 million equity and debt financing package for the development of a solar plant in Nkhotakota in central Malawi. Once complete, the plant will add 46MW of clean energy to the local power supply.
JCM Power, a Canada-based renewable energy development firm focused on projects in sub-Saharan Africa, Asia and Latin America has closed a significant institutional offering that was taken up by FinDev Canada, FMO, Swedfund, IFU, STOA Infra & Energy as well as some prominent Canadian family offices and foundations. The capital will be used to develop further projects - JCM Power has six projects at varying stages of development in Africa currently, all solar. Two in Malawi, three in Nigeria and one in Cameroon.
Rensource Energy, an off-grid micro utility provider based in Nigeria, announced the close of its Series A. An investor group led by CRE Venture Capital and the Omidyar Network has committed $20 million to the firm which will be used to finance the firm's expansion plans, both within Nigeria and further afield in Africa.
A well-known global consumer company also made deal news on the continent last week. PepsiCo is acquiring a stake in a producer and distributor of potato chips (or crisps) based in Ethiopia. The business, Senselect Food Processing, produces the SUN Chips range of products using locally sourced potatoes. PepsiCo takes over as the firm's majority stakeholder from its founder Veris Investments who will still retain a minority interest.
The biggest deal of the week came courtesy of the telecoms sector. American Towers has completed the deal to acquire Eaton Towers Holding, paying an estimated $1.85 billion for the business, including the assumption of the firm’s existing debt. As we reported previously, the deal has earned several private equity investors full exits from their stakes in the African telecoms towers firm. Among them, Capital Group, DPI, Ethos Private Equity and Standard Chartered Private Equity, but the breakdown of the sale and the IRRs earned by each of them was not made available.
Africa50 is making its third West African power sector investment of the past two months, backing the 461MW Azura-Edo IPP in Nigeria in an undisclosed equity deal. The transaction follows deals in Genser Energy, a Ghanaian IPP and another asset in Azura’s portfolio, the Tobene Power plant in Senegal, both of which took place in November.
In one of the biggest fundraising closes for some time, Verod Capital Management's third fund hit its hard cap, landing $200 million in commitments from a group of LPs from across the private capital investor spectrum. The level of investor interest in the fund looks like a strong vote of confidence in Verod's investment team and its strategy. The money will be put to work among small and medium-sized enterprises across several rapidly-developing sectors in anglophone West Africa.
As of January 1st, DOB Equity is operating under a shared leadership structure in Africa, following the relocation of its CEO, Brigit van Dijk-van de Reijt, back to Europe. Her responsibilities are now being handled by a trio of executives who will add their new Co-CEO functions to their existing roles. The three executives are Investment Director Saskia van der Mast, Portfolio Director Hayo Afman and Toine Huijbers, DOB Equity's CFO. Van der Mast and Afman are primarily based in the firm's Nairobi office, while Huijbers, who joined DOB Equity in 2003, works in The Netherlands.
And finally, the United States government's new development finance institution officially began operations at the beginning of the year, altering the development finance landscape significantly with the addition of new financing options and new authorities to support Africa and other emerging markets. The US International Development Finance Corporation or DFC for short effectively consolidates America's existing development finance activities - namely the Overseas Private Investment Corporation (OPIC) and USAID’s Development Credit Authority (DCA) - into one organization. DFC is equipped with new resources and tools to multiply its impact and its $60 billion investment cap is more than double OPIC’s $29 billion limit.
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.
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