Pan African Investor Mulls US$1,25bn Fund, Sees Opportunities Where Many Are Scaling Down

PRETORIA – Helios, the Pan African private equity investment firm co-founded by Nigerian-born dealmakers Tope Lawani and Babatunde Soyoye-is planning to raise US$1,25 billion for funding projects on the continent.

This will be the firm’s biggest fundraising to power businesses in a continent that has generally been underfunded.

A string of about 215 private equity firms operating in 27 African markets have either been scaling down or closing shop, according to African Private Equity and Venture Capital Association estimates.

Several advisories have reported that the Africa-focussed firm has been courting asset managers and development agencies for the transaction.

African Business says the firm, which is also based in London, could start the fund this year, adding to US$3,6 billion already under its management.

“Over the past few years private equity investment has returned to the continent lured by some of the world’s fastest economic growth rates, improving infrastructure and growing share of the global population,” it says.

“Private equity investment in Africa, dipped in 2018, while the overall number of deals grew, according to data from the African Private Equity and Venture Capital Association (AVCA). Last year the number of deals rose to 186 from 171 the year before, but the total value of those deals fell for a third consecutive year to US$3,5 billion, from U$3,9 billion in 2017,” the report says.

Over the last six months some private funds, such as New York-based Blackstone Group and banker Bob Diamond, have scaled back investment on the continent.

Investment firm, Blackstone is selling its Africa subsidiary Black Rhino Group almost five years after it committed to spending billions of dollars alongside Nigerian tycoon Aliko Dangote.

The news of the fund also follows the collapse of Dubai-based Abraaj Group, which left investors in Africa looking for a new fund manager.

The private equity firm was forced into liquidation in June after several investors, including the Bill & Melinda Gates Foundation, commissioned an audit to investigate alleged mismanagement of money in its $14 billion healthcare fund.

In Q4 2018, there were 215 private equity investment firms with 307 offices based across 27 sub-Saharan African markets, research by Asoko Insight and Africa Capital Digest found. This excludes firms that have an Africa focus but are not based on the continent.

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