Two of the more significant final fundraising closes of 2019 for Africa-focused private equity funds were announced last week. The larger of the two comes to us courtesy of Amethis, the Paris-based fund manager who closed their fund having garnered 25% more capital than they intended when they first launched the fund. Amethis Fund II now has €375 million (or about $425 million) with which to back growth capital opportunities in mid-cap businesses which will benefit from the continent’s expanding middle class.
The fund has already made two investments and is currently finalizing two further deals which it expects to close this summer. Early last year, Amethis invested in Groupe Premium, a Moroccan equipment distributor, followed a few months later when it led a trio of investors backing Merec Industries, a wheat miller and packaged food manufacturing business in Mozambique.
South Africa's EXEO Capital also held a final close for a second fund last week. While not as large as Amethis's new fund, at $146 million, EXEO-managed Agri-Vie II is still big by African private equity standards. Again, the fund raised considerably more capital than it originally intended to, from a balanced mix of DFIs and private sector institutions.
Agri-Vie II will target opportunities in mid to lower mid-cap food and agribusinesses, with a focus on those firms that add value in the food and agribusiness supply chain as well as those who produce the inputs used by commercial agriculture. To date, the fund has made four investments, backing TerraSan and Capital Fisheries, both aquaculture companies, Marginpar, a flower producer and distributor, and Jumbo Brands, a manufacturer of branded, non-alcoholic drinks
The biggest deal of the week came in the financial services sector. Britain's CDC Group is buying an equity stake in Morocco’s BMCE Bank of Africa. The development finance institution has agreed to invest $200 million in exchange for a 5% stake in the Casablanca-headquartered bank which serves more than 20 countries on the continent. According to CDC’s CEO, Nick O’Donohoe, investing in financial institutions which are well-integrated across the continent allows the DFI to quickly and effectively scale the impact of its investments.
The other deals of the week fall into the venture capital category. One is reportedly Egypt's ever largest-ever venture funding round. Cairo-based Swvl has raised $42 million from a group of investors led by Beco Capital and Vostok New Ventures. The fresh capital will be used to support Swvl's expansion plans into other Africa countries, which include a launch in Lagos within the next few weeks as well as establishing operations in an additional two African cities by the end of the year.
MAX.ng, a motorcycle ride-hailing company in Nigeria also landed a round of financing from a group of investors last week. Between them, Novastar Ventures, Goodwell Investments, Yamaha, Breakthrough Energy Ventures, Zrosk Investment Management and others are investing $7.5 million in the firm, bringing the total amount raised by the firm since its launch to $9 million. Among its plans, the company wants to expand to 10 additional West African cities, scale its technology infrastructure and deploy a mobile payment solution.
Staying in Nigeria, Consonance Investment Managers has led a group of investors backing MDaas Global, a business building tech-enabled diagnostic facilities under the BeaconHealth brand. The funding will be used to expand the business by establishing new diagnostic centers in Nigeria and across West Africa.
Naspers Foundry, the consumer internet group's start-up fund, announced that it had made its first investment last week. The company that's being backed is SweepSouth, an online cleaning services platform which connects clients with pre-vetted cleaners in several South African cities. With buoyant demand for trusted domestic service providers, the company has grown rapidly, creating jobs for over 10,000 people since its launch in 2014.
Finally, news of a possible future deal to keep an eye out for. Apis Partners has been granted the all-clear last week by South Africa's Competition Commission to proceed with a planned acquisition of Tutuka Software. The regulatory body approved the deal without conditions, granting the private equity investor permission to buy the Sandton-based payments company via a platform company.
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.