Weekly Africa Newsbriefs 19 February

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    Leriba Africa Newsbrief

     

     Week commencing 19 February 2018

     

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    Kenya

    Equity firm to acquire automaker

    Norwegian based private equity fund Ascent Rift Valley Fund is set to acquire Auto Springs East Africa, a manufacturer of automobile spare parts. The deal, in partnership with global financier SFC Finance, will offer finance for product expansion and factory improvements. In return, Auto Springs will give Ascent a foothold in the local market.

    Standard Media 14 February

     

    Private equity firm Fefisol invests in microfinancier Musoni

    Luxembourg-based private equity firm Fonds Européen de Financement Solidaire (Fefisol) has invested $986,680 in Nairobi-based credit lender Musoni Microfinance, which targets small-scale farmers and the informal sector. The funds will go towards developing financial products that stimulate food production and agri-business. The investment makes Fefisol the sixth shareholder of the micro financier from the European Solidarity Financing Fund for Africa.

    Business Daily Africa 15 February

     

    Zimbabwe

    ZimAlloys, Chinese firms in alluvial chrome pact

    Gweru-based ferrochrome producer Zimbabwe Alloys (ZimAlloys) has begun exploiting alluvial concentrates along the Great Dyke as it seeks to widen its revenue base. The firm entered into a partnership with two Chinese Companies – Decolux and San He Mining – to exploit the concentrates after India’s Balasore Alloys Group committed to injecting $100m to resuscitate operations at the ferrochrome producer. Plans are already under way in the North Dyke area for the establishment of six plants for the production of alluvial concentrates, each set to produce a minimum of 5,000 tonnes per month.

    The Herald Zimbabwe 16 February

     

    Morocco

    French operator to build hydropower plants

    French renewable power plants operator Voltalia has obtained permits for two hydropower plants of 9.8MW and 7.2MW. The permits follow technical approvals from Morocco’s National Office of Electricity and Drinking Water regarding the connection of the plants to the national grid. The electricity produced will be sold under long-term private power purchase agreements.

    Morocco World News 15 February

     

    Egypt

    AAIB co-finances largest solar energy project in ME and Aswan

    The Arab African International Bank will finance the largest solar power project in Egypt and the Middle East, with a target capacity of 1.8GW. The bank is keen on strengthening this competitive advantage by supporting investments and providing the necessary funding to raise the productive capacity of the energy sector in Egypt.

    Daily News Egypt 10 February

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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 19 February

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Weekly newsbriefs

Weekly Africa Newsbriefs 19 February

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

Leriba Africa Newsbrief

 

 Week commencing 19 February 2018

 

grinding-2755561_1280

 

 

 

 

 

 

 

 

 

 

Kenya

Equity firm to acquire automaker

Norwegian based private equity fund Ascent Rift Valley Fund is set to acquire Auto Springs East Africa, a manufacturer of automobile spare parts. The deal, in partnership with global financier SFC Finance, will offer finance for product expansion and factory improvements. In return, Auto Springs will give Ascent a foothold in the local market.

Standard Media 14 February

 

Private equity firm Fefisol invests in microfinancier Musoni

Luxembourg-based private equity firm Fonds Européen de Financement Solidaire (Fefisol) has invested $986,680 in Nairobi-based credit lender Musoni Microfinance, which targets small-scale farmers and the informal sector. The funds will go towards developing financial products that stimulate food production and agri-business. The investment makes Fefisol the sixth shareholder of the micro financier from the European Solidarity Financing Fund for Africa.

Business Daily Africa 15 February

 

Zimbabwe

ZimAlloys, Chinese firms in alluvial chrome pact

Gweru-based ferrochrome producer Zimbabwe Alloys (ZimAlloys) has begun exploiting alluvial concentrates along the Great Dyke as it seeks to widen its revenue base. The firm entered into a partnership with two Chinese Companies – Decolux and San He Mining – to exploit the concentrates after India’s Balasore Alloys Group committed to injecting $100m to resuscitate operations at the ferrochrome producer. Plans are already under way in the North Dyke area for the establishment of six plants for the production of alluvial concentrates, each set to produce a minimum of 5,000 tonnes per month.

The Herald Zimbabwe 16 February

 

Morocco

French operator to build hydropower plants

French renewable power plants operator Voltalia has obtained permits for two hydropower plants of 9.8MW and 7.2MW. The permits follow technical approvals from Morocco’s National Office of Electricity and Drinking Water regarding the connection of the plants to the national grid. The electricity produced will be sold under long-term private power purchase agreements.

Morocco World News 15 February

 

Egypt

AAIB co-finances largest solar energy project in ME and Aswan

The Arab African International Bank will finance the largest solar power project in Egypt and the Middle East, with a target capacity of 1.8GW. The bank is keen on strengthening this competitive advantage by supporting investments and providing the necessary funding to raise the productive capacity of the energy sector in Egypt.

Daily News Egypt 10 February