Adenia Africa Fund managed by private equity firm Adenia Partners Ltd. raised $470 million to invest in the continent’s fintech, telecom and healthcare sectors, among others.
The funding came as Adenia’s largest Africa-focused fund to date and added new investors including Norfund AS, US International Development Finance Corp. and Canada’s Findev Inc.
Africa’s largest fund manager, 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 the Ghanaian and Kenyan pension funds.
Adenia CEO Alexis Caude said this is the firm’s fifth fund, for which it has increased the size of equity checks for targets on average to about $40 million.
Investment condition
Speaking about the Fund’s focus and the premise for the investment, Caude said:
- “Over time, we have moved to the continent’s largest economies where we see businesses that meet the criteria we want for our transactions.
- “We only invest in businesses where we can take a controlling stake – from 51% to 100% – so we’re in the driver’s seat.”
- “Africa-focused private equity managers need to provide investors with returns and exit options. Adenia is seeking net returns of at least 15% in hard currency and is taking a controlling stake in businesses to be able to dictate the timing of the exit.
- “The environment is not easy in Africa with interest rates that are really high. Making refunds is difficult, with currencies depreciating. Exits are complex in Africa, which is why we believe in taking controlling stakes in businesses – this makes it easier to attract strategic investors,” added Caude.
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., from Carlyle Group Inc. and Helios Investment Partners LLP.
The fund is currently involved in a deal with Air Liquide SA involving 12 African businesses. The firm has also developed money in South Africa and recently opened an office in Lagos, Nigeria.
- “We’ve expanded our presence in Nigeria – while it’s a tough place, it’s a big economy.” Caude said.
Caude said the Mauritius-based firm, founded in 2002, operates in seven African countries, with 21 investment professionals. According to him, on average, most of its biggest investors, including the European Investment Bank and the International Finance Corp. of the World Bank, have doubled their commitments.