Helios buys e-commerce company for $110m

Africa-focused private equity firm Helios Investment Partners has acquired a 68 percent stake in Nigerian electronic transaction switching and payment processing company InterSwitch for $110 million.

Interswitch provides message broker solutions for financial transactions and administers Verve, a chip-and-pin card issued by 16 of the 24 banks in Nigeria. The company is the only switching and processing business connected to all of Nigeria’s banks. Helios made the investment from its second fund, which is targeting about $650 million and collected $540 million last summer.

Technology-oriented private equity firm Adlevo Capital will be co-investing alongside Helios in the transaction. The firm held a first close on $52 million for its Sub-Saharan Africa focused fund in June 2010, and expects to hold a final close in the first quarter of 2011.

Helios was advised by FT Advisors Limited, KPMG and Roland Berger Strategy Consultants.

Major private equity firms Advent International and Bain Capital have targeted the payment processing space in recent years. The two firms acquired RBS WorldPay, the Royal Bank of Scotland’s card payment subsidiary business in August for an enterprise value of up to $3.2 billion. Advent had previously purchased a majority stake in electronic payments and credit card processing services company Fifth Third Processing Solutions in 2009, prior to which Bain invested $75 million in FleetCor, a provider of specialised credit cards, in 2005.

Helios was founded in 2004 by co-founding partners Tope Lawani and Babatunde Soyoye and currently has $1.4 billion under management. The firm operates a family of funds and co-investment entities, and also managed the $110 million Modern Africa Fund on behalf of a number of investors including the US government's Overseas Private Investment Corporation and several US corporations.