Weekly Africa Newsbriefs 21 May

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

    Leriba Africa Newsbrief

     

     

    Week commencing 21 May 2018

     

     


    steel-mill-616536_1280

     

     

     

     

     

     

     

     

     

     

    Zimbabwe

    Sinosteel to put up $1bn for power and furnaces

    Chinese engineering firm Sinosteel Corporation has agreed to invest $1bn to build a power plant and increase ferrochrome output. The Chinese firm plans to build three additional furnaces at its majority-owned Zimasco business, which would raise ferrochrome output by 120,000 tonnes over the next five years to 300,000 tonnes per year and 500,000 tonnes annually in 10 years’ time. The firm also plans to build a 400MW coalbed methane-fired power plant in western Zimbabwe.

    Business Day 15 May

     

     

    Nigeria

    Global oil traders bid for Petrobras Africa

    The world’s three largest oil traders are competing to buy the African arm of Brazil’s Petrobras, which owns stakes in two major Nigerian offshore oil blocks. In 2017 Petrobras launched the sale of 100% of Petrobras Oil & Gas, or Petrobras Africa, as part of the heavily indebted company’s plan to offload $21bn in assets throughout 2018. Vitol bid together with the subsidiary of US private equity firm Warburg Pincus called Delonex and Canadian-listed Africa Energy. Glencore joined up with Nigerian-listed firm Seplat and French firm Maurel & Prom. The third bidder was privately held Famfa Oil together with Royal Dutch Shell. Petrobras is expected to make a decision by month-end.

    Business Day 18 May

     

     

    Kenya

    General Electric buys 20% stake in coal plant

    American energy firm GE Power has bought a $398m stake in the 1,050MW Lamu coal-fired electricity generation plant. The deal will see the US conglomerate allocated a 20% stake in Amu Power. The capital injection will be used for the acquisition of plant machinery, a boiler and steam turbine generator, as well as air quality control systems. 

    Business Daily 17 May

     

     

    TPG invests $47.5 m in Cellulant

    Global private investment firm TPG has paid $47.5m to acquire an unspecified stake in digital payments firm Cellulant, which operates in 11 African markets, providing digital payments platforms and mobile banking services for individuals without bank accounts. The deal is the largest investment of its kind in an African financial technology firm for TPG. It will enable Cellulant to expand into new markets and continue investing in its existing operations.

    Reuters 14 May

     

     

    Morocco

    China’s ZTT to open new plant in Tangier

    Chinese wire and cable company ZTT Group has begun construction work on its 40,000m2 plant in the northern city of Tangier. The plant will produce electric cables and optical fibre. It will require an investment of $23.5m and offer an estimated 200 jobs.

    New Times 16 May

    This entry was posted in Leriba in the Media, Snapshots, Weekly newsbriefs. Bookmark the permalink.

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 21 May

Leriba in the Media
>>
Snapshots
>>
Weekly newsbriefs

Weekly Africa Newsbriefs 21 May

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

Leriba Africa Newsbrief

 

 

Week commencing 21 May 2018

 

 


steel-mill-616536_1280

 

 

 

 

 

 

 

 

 

 

Zimbabwe

Sinosteel to put up $1bn for power and furnaces

Chinese engineering firm Sinosteel Corporation has agreed to invest $1bn to build a power plant and increase ferrochrome output. The Chinese firm plans to build three additional furnaces at its majority-owned Zimasco business, which would raise ferrochrome output by 120,000 tonnes over the next five years to 300,000 tonnes per year and 500,000 tonnes annually in 10 years’ time. The firm also plans to build a 400MW coalbed methane-fired power plant in western Zimbabwe.

Business Day 15 May

 

 

Nigeria

Global oil traders bid for Petrobras Africa

The world’s three largest oil traders are competing to buy the African arm of Brazil’s Petrobras, which owns stakes in two major Nigerian offshore oil blocks. In 2017 Petrobras launched the sale of 100% of Petrobras Oil & Gas, or Petrobras Africa, as part of the heavily indebted company’s plan to offload $21bn in assets throughout 2018. Vitol bid together with the subsidiary of US private equity firm Warburg Pincus called Delonex and Canadian-listed Africa Energy. Glencore joined up with Nigerian-listed firm Seplat and French firm Maurel & Prom. The third bidder was privately held Famfa Oil together with Royal Dutch Shell. Petrobras is expected to make a decision by month-end.

Business Day 18 May

 

 

Kenya

General Electric buys 20% stake in coal plant

American energy firm GE Power has bought a $398m stake in the 1,050MW Lamu coal-fired electricity generation plant. The deal will see the US conglomerate allocated a 20% stake in Amu Power. The capital injection will be used for the acquisition of plant machinery, a boiler and steam turbine generator, as well as air quality control systems. 

Business Daily 17 May

 

 

TPG invests $47.5 m in Cellulant

Global private investment firm TPG has paid $47.5m to acquire an unspecified stake in digital payments firm Cellulant, which operates in 11 African markets, providing digital payments platforms and mobile banking services for individuals without bank accounts. The deal is the largest investment of its kind in an African financial technology firm for TPG. It will enable Cellulant to expand into new markets and continue investing in its existing operations.

Reuters 14 May

 

 

Morocco

China’s ZTT to open new plant in Tangier

Chinese wire and cable company ZTT Group has begun construction work on its 40,000m2 plant in the northern city of Tangier. The plant will produce electric cables and optical fibre. It will require an investment of $23.5m and offer an estimated 200 jobs.

New Times 16 May