Adenia Africa Fund managed by private equity firm Adenia Partners Ltd. has raised $$470 million to be invested in the continent’s fintech, telecommunications, and healthcare sectors, among others.
The funding came as Adenia’s largest Africa-focused fund to date and added new investors including Norfund AS, the US International Development Finance Corp., and Canada’s Findev Inc.
Africa’s biggest fund manager, the Public Investment Corp. Ltd. which oversees about 2.6 trillion rand ($138 billion) in South African government-employee pension assets, also backed the Adenia fund, along with Ghanaian and Kenyan pension funds.
Adenia Managing Director Alexis Caude said this is the company’s fifth fund, for which it has increased the equity cheque size for targets to an average of about $40 million.
Investment condition
Speaking on the Fund’s focus and the condition for the investment, Caude said:
- “In time, we have moved to the larger economies on the continent, where we see businesses that fit the criteria that we want for our transactions.
- “We only make investments in businesses where we can take a controlling stake – of between 51% to 100% – so that we can be in the driver’s seat.”
- “Africa-focused private equity managers need to provide investors with returns and exit options. Adenia seeks net returns of at least 15% in hard currency and takes a controlling stake in businesses to be able to dictate exit timing.
- “The environment is not easy in Africa with interest rates that are really high. To make returns is difficult, with the currencies depreciating. Exits are complicated in Africa, which is why we believe in taking a controlling stake in businesses – this makes it easier to attract strategic investors,” Caude added.
Adenia’s operations in Africa
Adenia, which has been operating on the continent for the past 20 years, faces competition from the likes of Alterra Capital Partners Ltd., spun out of Carlyle Group Inc., and Helios Investment Partners LLP.
The fund is currently engaged in a carve-out deal with Air Liquide SA that involves 12 African operations. The firm has also deployed money in South Africa and has recently opened an office in Lagos, Nigeria.
- “We have expanded our presence to Nigeria – while it’s a challenging place, it’s a large economy,” Caude said.
Caude said the Mauritius-headquartered company, founded in 2002, operates in seven African countries, with 21 investment professionals. According to him, on average, most of its older investors, including the European Investment Bank and the World Bank’s International Finance Corp., have doubled their commitments.
