Tunga Management Company, a newly launched infrastructure, mining and private equity fund formed by Namibian affiliates of South African asset manager OldMutual Group, will sell a 26 percent stake in itself to a black empowerment enterprise (BEE), according to fund director Steve Galloway. Unlike South Africa, Namibia does not have BEE legislation requiring black participation in business enterprises, but encourages such activity.
CDC, the UK government fund of funds manager, which invests around $1 billion in emerging markets-focused funds annually, will increase its investment into Sub-Saharan Africa following a review of its investment guidelines. The new rules from the UK's Department for International Development require at least half of the funds of funds' investments to be directed to Sub-Saharan Africa. Previously the fund could divide this 50 percent between Sub-Sahara and South Asia.
ENERGY AND INFRASTRUCTURE
Black River Asset Management has committed $70 million to a coal-based energy initiative in Africa with White Energy, an energy efficiency technology provider. White Energy has contributed approximately $31 million to the venture, but will hold a 51 percent stake in the resulting company, which will further commercialise White Energy's coal efficiency technology across Africa and develop and operate coal upgrading plants.
Emerging Africa Infrastructure Fund, a $365 million debt fund, will provide $14 million in senior debt to US-based renewable power generator SAEMS for a hydro power project in Mpanga, Uganda. The fund will also provide $35 million to Tronder Power, a subsidiary of Norway-based power company TrønderEnergi, to develop a hydro electric power project in Bugoye. The two hydro projects will help plug Uganda's gaping energy market.
Andrew Alli, former deputy chief executive of Nigerian private equity firm Travant Capital Partners, has left the firm to become head of the hybrid development finance institution Africa Finance Corporation (AFC). Acting AFC chief Solomon Asamoah was appointed to the newly created position of deputy chief executive, effective 1 November. Prior to launching Travant, Alli served as country manager for the International Finance Corporation in Nigeria and Southern Africa. Separately, Travant has made its first investment in Dorman Long Engineering, an oil and gas services company based in Nigeria. The investment was made through the Private Equity Fund 1, which held its first close in May 2008 at $107 million and is targeting total commitments of $300 million for investments in West and Central Africa.
Nigeria has the political will and resources to provide lucrative opportunities for private investment firms to help fund the country's huge infrastructure needs, then-interim African Finance Corporation chief Solomon Asamoah told sister website PrivateEquityOnline. Those opportunities could total $510 billion in the next decade, and may be concentrated in the oil-rich nation's energy sector.
Ratings agency Standard & Poor's has cut its outlook on South Africa's BBB+ credit rating to negative from stable based on currency concerns and fears of a future economic slump. The rand has been highly volatile this year, at one point falling by a third in value against the dollar. Standard & Poor's also predicted that domestic South African demand will probably contract, pushing the government to increase spending.
A consortium led by Absa Capital Private Equity has acquired leading South African waste management group EnviroServ Holdings, in a transaction valued at ZAR1.9 billion (€148 million; $188 million). The deal is reportedly the largest publicto-private transaction in South Africa in 2008.