Weekly Africa Newsbriefs 14 August

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    Leriba Africa Newsbrief

     

     Week commencing 14 August 2017

     


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    Uganda

    Kansai buys paint manufacturer for $87m

    Sadolin group, the largest paint manufacturer in Uganda with more than 50% market share, will soon become Kansai Plascon following an acquisition by the Japanese firm. The Osaka-based company bought all stakes in Sadolin worth an estimated $87m.

    The Guardian (Uganda) 10 August

     

    Pan Africa

    500 kilovolt power line for horn of Africa

    Ethiopia and Kenya have become the first nations in the region to set up a 500kv power line. Expected to cost $1.26bn, hopes are high that the benefits of the power line, financed by the African Development Bank, will outweigh its cost over the long term. Chinese firm China Electric Power Equipment & Technology will handle all construction work. Once completed, the power line will have the transmitting capacity of 2,000MW.

    Fana Broadcasting Corporation 5 August

     

    Zimbabwe

    Indian investor acquires majority stake in Zim-Alloys

    An unnamed investor has acquired a 70% stake in Zimbabwe’s second-largest ferro-chrome producer, Zim-Alloys, for $90m. The investment will see the holding of former majority stakeholder, Farai Rwodzi, diluted. Zim-Alloys was sold to the Farai Rwodzi-led Benscore Consortium for $10m in 2005 but the business failed to take off due to the closure of four furnaces and poor global metal prices. The company is now exploring the possibility of upgrading its heavy media separation plant at Sutton Mine.

    The Harald 9 August

     

    Morocco

    Wärtsilä to build 22MW power plant

    Finnish electric generator manufacturer Wärtsilä will provide the Dakhla region’s state utility with a 22MW baseload power plant under an engineering, procurement, and construction contract concluded with the National Office of Water & Electricity. The plant is expected to be fully operational by January 2019.

    Morocco World News 10 August

     

    Liberia

    LEC gets $11m storage facility

    The Liberia Electricity Corporation has received a new storage facility at its Bushrod Island offices. The facility will store approximately 5,280,000 gallons of heavy fuel oil. The project, funded by the World Bank, is a component of the Liberia Accelerated Electricity Expansion Project, whose objective includes increasing access to electricity and strengthening the institutional capacity of Liberia’s energy sector.

    Daily Observer 10 August

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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 14 August

Leriba in the Media
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Snapshots
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Weekly newsbriefs

Weekly Africa Newsbriefs 14 August

 

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

Leriba Africa Newsbrief

 

 Week commencing 14 August 2017

 


painter-1246619_1280

 

 

 

 

 

 

 

 

Uganda

Kansai buys paint manufacturer for $87m

Sadolin group, the largest paint manufacturer in Uganda with more than 50% market share, will soon become Kansai Plascon following an acquisition by the Japanese firm. The Osaka-based company bought all stakes in Sadolin worth an estimated $87m.

The Guardian (Uganda) 10 August

 

Pan Africa

500 kilovolt power line for horn of Africa

Ethiopia and Kenya have become the first nations in the region to set up a 500kv power line. Expected to cost $1.26bn, hopes are high that the benefits of the power line, financed by the African Development Bank, will outweigh its cost over the long term. Chinese firm China Electric Power Equipment & Technology will handle all construction work. Once completed, the power line will have the transmitting capacity of 2,000MW.

Fana Broadcasting Corporation 5 August

 

Zimbabwe

Indian investor acquires majority stake in Zim-Alloys

An unnamed investor has acquired a 70% stake in Zimbabwe’s second-largest ferro-chrome producer, Zim-Alloys, for $90m. The investment will see the holding of former majority stakeholder, Farai Rwodzi, diluted. Zim-Alloys was sold to the Farai Rwodzi-led Benscore Consortium for $10m in 2005 but the business failed to take off due to the closure of four furnaces and poor global metal prices. The company is now exploring the possibility of upgrading its heavy media separation plant at Sutton Mine.

The Harald 9 August

 

Morocco

Wärtsilä to build 22MW power plant

Finnish electric generator manufacturer Wärtsilä will provide the Dakhla region’s state utility with a 22MW baseload power plant under an engineering, procurement, and construction contract concluded with the National Office of Water & Electricity. The plant is expected to be fully operational by January 2019.

Morocco World News 10 August

 

Liberia

LEC gets $11m storage facility

The Liberia Electricity Corporation has received a new storage facility at its Bushrod Island offices. The facility will store approximately 5,280,000 gallons of heavy fuel oil. The project, funded by the World Bank, is a component of the Liberia Accelerated Electricity Expansion Project, whose objective includes increasing access to electricity and strengthening the institutional capacity of Liberia’s energy sector.

Daily Observer 10 August