--> Africa still represent more than 20% of Bollore Revenue, Bollore just announced a new rail project for 1bil this morning, we could contiue to see some devent outperformance of Sub saharian investments even if oil continue to trade lower and there is some geopolitical risks.
Bollore is down 20% since highs and weakness in emerging market could spur new investment in Africa...
FT : Africa private equity group raises $1.4bn to invest in continent 4.10 /4.30 appear to be a good level.
Abraaj Group, a Dubai-based company, has amassed the largest pool of private equity capital yet for investments across Africa.
The group, which focuses on private equity in emerging markets “beyond the Brics”, said it had raised $375m for a fund that will focus on North Africa.
Combined with capital raised in April targeted at the sub-Saharan region, the two funds give Abraaj just under $1.4bn to spend in the continent’s markets, a record sum to raise in a single year.
This follows an Africa-wide fund raised earlier this year by Helios Investment Partners, a rival to Abraaj, which was the first dedicated to the region to surpass $1bn.
The dawn of billion-dollar African private equity funds reflects a search by investors for higher returns than are on offer in the saturated buyout markets of the US and Europe, and also represents a bet on the continent’s growing middle class.
International buyout groups including Carlyle and KKR expanded into the region last year, with maiden investments often focused on consumer growth. This is despite concerns that larger funds in Africa could be left to chase relatively few opportunities, given the limited size of its capital markets.
Mustafa Abdel-Wadood, a partner at Abraaj who runs its regional funds, said that splitting the funds’ capital between north and south would give investors a choice over which markets they wanted to invest in.
“If they want to look at Africa as one continent, or they want to see it as separate markets, they can,” he said.
Mr Abdel-Wadood added that the funds would draw from an on-the-ground search for companies, as deals placed in the market are only a “subset” of opportunities. These are businesses we approach proactively,” he said.
Abraaj has already made six investments from the new North Africa fund, including a hospital group which it plans to roll out across the region.
The fund will look for majority or minority stakes in mid-market companies based in Algeria, Egypt, Morocco and Tunisia that Abraaj could help turn into regional market leaders.
Sharp falls in African currencies triggered by collapsing commodity prices have also posed pitfalls for private equity investors in the region.
Currency volatility had become a “big part of the discussion we’re having” over investments in the region, Mr Abdel-Wadood said.
“This is not the first time these markets have faced currency issues,” he added, noting that a drop in exchange rates often occurs in one big step. “Over the lifetime of an investment, this can be absorbed by the underlying growth of the business.”
Abraaj was, however, looking at defensive sectors more. “This is a year where one needs to be cautious,” Mr Abdel-Wadood said.
