Weekly Africa Newsbriefs 18 June

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    Leriba Africa Newsbrief

     

     Week commencing 18 June 2018

    ARM cement

     

     

     

     

     

     

     

     

     

    Tanzania

    ARM sweetens cement sale deal

    ARM Cement has sweetened a deal for buyers of its non-cement businesses, offering them additional assets in Tanzania worth US$8.5m for free. The company earlier announced it had reached an agreement to sell its fertiliser and mineral production businesses in Kenya to Swiss firm Omya and Pinner Heights Ltd, a company owned by its CEO Pradeed Paunrana, for $15.9m.

    Business Daily 13 June

     

    Democratic Republic of Congo

    Work to begin on Inga hydropower

    The Democratic Republic of Congo plans to start work this year on the frequently delayed Inga 3 hydropower project, after receiving a joint bid from two previously competing consortia of investors. One group led by China Three Gorges Corporation and another including Actividades de Construccion y Servicios SA of Spain submitted a joint bid on 6 June. The project will produce 11,000MW and is predicted to cost $13.9bn

    Liquid Africa 14 June

     

    Kenya

    Seaboard gives Unga shareholders more time

    Minority shareholders of Unga Group have been given 10 more days, to 28 June, to consider a US40c/share buyout offer from Delaware-based conglomerate Seaboard Corporation. The extension is a signal that the multinational may not have amassed the minimum acceptances amounting to a 75% stake needed for the transaction to proceed.

    Business Daily 15 June

     

    Egypt

    Solar project powers ahead

    A $22m investment will be pumped into a new deal between KarmSolar, Egypt’s leading solar power solutions provider, and private real estate developer El Badr for Investment and Commercial Spaces, enabling its commercial project to run 100% by solar. The deal includes a commitment by KarmSolar to build solar stations producing a total of 20MW by 2021.

    Liquid Africa 11 June

     

    Nigeria

    Àrgentil invests in flexible housing developer

    Àrgentil Capital Partners has acquired a 20% stake in Tempo Housing Nigeria Ltd. Tempo specialises in developing flexible residential and work spaces using modern prefabricated technology. Àrgentil also provided debt as part of its overall financing to the company. Àrgentil is investing through the Àrgentil Principal Investment Portfolio II, an SME vehicle which invests equity and debt in small and medium scale companies operating in Nigeria.

    Africa Private Equity and Venture Capital Association 1 June 2018

     

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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 18 June

Snapshots
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Weekly newsbriefs

Weekly Africa Newsbriefs 18 June

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

Leriba Africa Newsbrief

 

 Week commencing 18 June 2018

ARM cement

 

 

 

 

 

 

 

 

 

Tanzania

ARM sweetens cement sale deal

ARM Cement has sweetened a deal for buyers of its non-cement businesses, offering them additional assets in Tanzania worth US$8.5m for free. The company earlier announced it had reached an agreement to sell its fertiliser and mineral production businesses in Kenya to Swiss firm Omya and Pinner Heights Ltd, a company owned by its CEO Pradeed Paunrana, for $15.9m.

Business Daily 13 June

 

Democratic Republic of Congo

Work to begin on Inga hydropower

The Democratic Republic of Congo plans to start work this year on the frequently delayed Inga 3 hydropower project, after receiving a joint bid from two previously competing consortia of investors. One group led by China Three Gorges Corporation and another including Actividades de Construccion y Servicios SA of Spain submitted a joint bid on 6 June. The project will produce 11,000MW and is predicted to cost $13.9bn

Liquid Africa 14 June

 

Kenya

Seaboard gives Unga shareholders more time

Minority shareholders of Unga Group have been given 10 more days, to 28 June, to consider a US40c/share buyout offer from Delaware-based conglomerate Seaboard Corporation. The extension is a signal that the multinational may not have amassed the minimum acceptances amounting to a 75% stake needed for the transaction to proceed.

Business Daily 15 June

 

Egypt

Solar project powers ahead

A $22m investment will be pumped into a new deal between KarmSolar, Egypt’s leading solar power solutions provider, and private real estate developer El Badr for Investment and Commercial Spaces, enabling its commercial project to run 100% by solar. The deal includes a commitment by KarmSolar to build solar stations producing a total of 20MW by 2021.

Liquid Africa 11 June

 

Nigeria

Àrgentil invests in flexible housing developer

Àrgentil Capital Partners has acquired a 20% stake in Tempo Housing Nigeria Ltd. Tempo specialises in developing flexible residential and work spaces using modern prefabricated technology. Àrgentil also provided debt as part of its overall financing to the company. Àrgentil is investing through the Àrgentil Principal Investment Portfolio II, an SME vehicle which invests equity and debt in small and medium scale companies operating in Nigeria.

Africa Private Equity and Venture Capital Association 1 June 2018