Weekly Africa Newsbriefs 12 November

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    Leriba Africa Newsbrief

     

    Week commencing 12 November

     

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    Zimbabwe

    Econet to bundle subsidiaries into one listed entity

    Econet Wireless Zimbabwe plans to list its financial units as a single entity on the country’s stock exchange and sell a majority stake in network operator Liquid Telecom back to the South African firm’s parent company. The Harare-based firm founded by Zimbabwean tycoon Strive Masiyiwa plans to create a newly listed business called Cassava Smartech Zimbabwe Ltd. EcoCash, Econet Life, Econet Insurance and Steward Bank will be transferred into the new entity.

    Bloomberg 9 November

     

    Pan Africa

    KenolKobil to acquire petrol stations

    Oil marketer KenolKobil, listed on the Nairobi Securities Exchange, is set to acquire 33 petrol stations in Uganda and Rwanda from Delta Petroleum for an undisclosed amount. KenolKobil is back on the expansion trail having previously scaled down its regional footprint in Tanzania and the Democratic Republic of Congo markets.

    The Daily Nation 7 November

     

    Kenya

    Dangote interested in ARM Cement acquisition

    Dangote Cement, Africa’s biggest producer of the building material, has expressed an interest in acquiring Kenyan rival ARM Cement, according to three people familiar with the matter. ARM has been exploring a sale since at least October 2017. The company, part-owned by CDC Group, was placed in administration in August after failing to find a strategic investor to help it manage debts of $141m.

    Bloomberg 8 November

     

    Wärtsilä secures solar plant contracts

    Finnish power manufacturing and service company Wärtsilä won two engineering, procurement and construction contracts to develop grid-connected solar firms in Kenya. The Wärtsilä east African unit will begin construction next year and each plant will have a capacity of 40 megawatts.

    Bloomberg 8 November

     

    Sub-Saharan Africa

    Equator Capital invests in MFS Africa

    US-based impact fund manager Equator Capital Partners announced the first investment from its new ShoreCap III fund in pan-African fintech company, MFS Africa. The fintech company is the largest digital payments hub on the continent, connected to over 170-million mobile wallets in sub-Saharan Africa.

    Africa Global Funds 8 November

     

    Uber-Suzuki deal enables vehicle ownership

    Transportation companies Uber and Suzuki Motor are partnering to make cab-hailing services in Africa faster and cheaper. The deal enables drivers who don’t own their own vehicle or cannot raise credit to buy a car the opportunity to do so.  Across sub-Saharan Africa the Suzuki Alto model will be used for the quick-trip, low-cost Uber ChapChap (meaning faster in Swahili) service.

    The New Times 4 November

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Opportunity

   
A rapidly growing and urbanising middle class set to experience a consumption boom; the world’s greatest resources of as-yet-untapped agricultural land, oil, gas and countless other commodities; and a growing number of entrenched, stable democracies with increasingly sophisticated democratic institutions. Africa is the last major region in the world to offer the prospect of take-off phase economic growth, delivering world-beating returns to investors.
5.6%
GDP growth rate in the decade to 2013 average in Africa; 7% expected in the next decade
7
of the 10 fastest growing economies in the world over the next decade will be African
4
of the 10 most improved economies for doing business are in Africa
   
Urbanisation Natural Resources
The population of Africa’s cities will triple by 2050 with over one billion people living in cities by 2040. Lagos is the largest with over 12,4 million people. Urbanisation presents opportunities for tertiary sectors like retail, telecommunications, banking and logistics. Major recent discoveries in oil, iron ore, natural gas, and other key commodities are set to provide major economic stimulus. Urbanisation in Africa and the rest of the world will drive demand for natural resources which Africa is uniquely positioned to satisfy with both new and old discoveries.
   
   

Risk

     
90%
of African countries score below 50 in Transparency International's corruption perception index
16
African countries use International Financial Reporting Standards, others inconsistent
45
African countries have media sectors that are considered not free
   
The continent remains a difficult place to do business. The regulatory and legal structures common in much of the world are only nascent in many African countries. In rapidly changing economies, reputations are only starting to develop and information on performance histories difficult to obtain. Weak media sectors often mean that critical information relevant to potential exposures is never publicly  disseminated. Data are scarce making traditional investment analysis difficult if not impossible. The incentives facing local partners are opaque and may well be antithetical to outside investors’ interests. As in any rapidly changing environment, opportunists are aiming to exploit potential investors. Just as the opportunities in Africa are clear, the stories of investments gone wrong are sobering.
   

Solved

   
Leriba is a specialist consultancy with a unique combination of financial and political research skills. We help analyse opportunities and examine current investments for unforeseen political and financial risks. We recognise the investment
 
opportunities in Africa but we are pragmatic about the challenges. Our insights provide actionable information which directly pay off through better investment decisions.
PEOPLE OUR VALUES COUNTRIES INDUSTRIES 
Our directors have decades of experience in Africa. We work with a network of associates across the continent with support staff in London and Johannesburg
 
First and foremost we aim to make a positive contribution to our clients and to the societies in which we operate. Clients can have full confidence in our ethics, professionalism and discretion. Our staff are governed by a strict code of conduct and many are members of professional societies
 
Unlike some other consultancies, our analysts live and work in Africa and have built up substantial networks and insight. We are able to work in any of Africa’s 54 countries.
 
We have worked in a wide range of industries, including:
 
Banking, oil & gas, mining, telecoms, IT, retail, logistics, agriculture, insurance, fund management, FMCG, hotels & tourism, energy and infrastructure 
       
       

Weekly Africa Newsbriefs 12 November

Snapshots
>>
Weekly newsbriefs

Weekly Africa Newsbriefs 12 November

To receive this brief in your email every Monday, please subscribe here.

Leriba Africa Newsbrief

 

Week commencing 12 November

 

aerial-1880873_960_720

 

 

 

 

 

 

 

 

 

 

Zimbabwe

Econet to bundle subsidiaries into one listed entity

Econet Wireless Zimbabwe plans to list its financial units as a single entity on the country’s stock exchange and sell a majority stake in network operator Liquid Telecom back to the South African firm’s parent company. The Harare-based firm founded by Zimbabwean tycoon Strive Masiyiwa plans to create a newly listed business called Cassava Smartech Zimbabwe Ltd. EcoCash, Econet Life, Econet Insurance and Steward Bank will be transferred into the new entity.

Bloomberg 9 November

 

Pan Africa

KenolKobil to acquire petrol stations

Oil marketer KenolKobil, listed on the Nairobi Securities Exchange, is set to acquire 33 petrol stations in Uganda and Rwanda from Delta Petroleum for an undisclosed amount. KenolKobil is back on the expansion trail having previously scaled down its regional footprint in Tanzania and the Democratic Republic of Congo markets.

The Daily Nation 7 November

 

Kenya

Dangote interested in ARM Cement acquisition

Dangote Cement, Africa’s biggest producer of the building material, has expressed an interest in acquiring Kenyan rival ARM Cement, according to three people familiar with the matter. ARM has been exploring a sale since at least October 2017. The company, part-owned by CDC Group, was placed in administration in August after failing to find a strategic investor to help it manage debts of $141m.

Bloomberg 8 November

 

Wärtsilä secures solar plant contracts

Finnish power manufacturing and service company Wärtsilä won two engineering, procurement and construction contracts to develop grid-connected solar firms in Kenya. The Wärtsilä east African unit will begin construction next year and each plant will have a capacity of 40 megawatts.

Bloomberg 8 November

 

Sub-Saharan Africa

Equator Capital invests in MFS Africa

US-based impact fund manager Equator Capital Partners announced the first investment from its new ShoreCap III fund in pan-African fintech company, MFS Africa. The fintech company is the largest digital payments hub on the continent, connected to over 170-million mobile wallets in sub-Saharan Africa.

Africa Global Funds 8 November

 

Uber-Suzuki deal enables vehicle ownership

Transportation companies Uber and Suzuki Motor are partnering to make cab-hailing services in Africa faster and cheaper. The deal enables drivers who don’t own their own vehicle or cannot raise credit to buy a car the opportunity to do so.  Across sub-Saharan Africa the Suzuki Alto model will be used for the quick-trip, low-cost Uber ChapChap (meaning faster in Swahili) service.

The New Times 4 November