African Capital Markets News » Ghana

Silk Invest says Egypt elections will be turning point

Tom Minney — Tue, 27 Sep 2011 17:59:03 +0000

Mark Voss of fund manager Silk Invest (www.silkinvest.com) foresees a turning point for the Egyptian market in a recent note. He also notes growth in Tunisia, with companies back to pre-revolution levels, tourism boom in Morocco, giant growth in Ghana and telecom payments innovation in Kenya.
He says the company clearly sees value in the market, but the evolving politics has cast a cloud on investor sentimenty. “We believe this is now lifting as the country’s election commission chief announced a roadmap for parliamentary elections – and a crucial step in transitioning to civilian rule, from 21 November to 4 March 2012. This should also pave the way forward for the Presidential elections by early next year. Going forward, we suspect that this may mark a turning point in the market’s fortunes.” He adds that there is no shortage of lenders to help the country get back on its feet. He adds that core inflation was 6.9% in August from 8.7% in July and Suez Canal revenues climbed 8.5% year-on-year in August.
Also on the post-revolutionary theme, he looks at Tunisia and said it “continued its upward trend with many companies now back at their pre-Jasmine revolution price levels”. Tourism in Morocco was surging and by end of July was up nearly 10% year on year.
For the rest of Africa he pointed out that the IMF forecasts 13% GDP growth for Ghana this year and noted the Chinese gave a US$3 billion loan for further infrastructure developments. In Kenya: “interest rates were notched slightly up to help control inflation and reduce local currency volatility. Following an unexpected increase in harvested maize, food inflation in the country is expected to decline”. Telecoms innovation continues full speed in Kenya, as Airtel Kenya unveiled an online payment system enabling mobile subscribers to use handsets to make purchases online, while Safaricom and I&M Bank launched a service that allows M-pesa customers to transfer money from their accounts to a pre-paid visa card – which can be used globally.

Tullow Oil listing to double value of shares on Ghana Stock Exchange

Tom Minney — Mon, 25 Jul 2011 11:52:32 +0000

Tullow Oil plc (www.tullowoil.com) is expected to start trading on the Ghana Stock Exchange (www.gse.com.gh) from 27 July after allocating 3,531,546 ordinary shares of 10p each in a successful offer of up to 4,000,000 shares. The company says this is the largest primary share offer completed on the GSE and will more than double the market capitalisation.
The offer was open between 13 June and 4 July and shares were offered at 31 Ghana Cedis. During this period, 10,147 valid applications were received for 3,531,546 shares, representing 109.5 million Ghana Cedis ($72.3m). Everyone who submitted a valid application is to receive their shares in full, applicants are to have their GSE Securities Depository Accounts credited with their allotted shares today (25 July) and can start trading the shares on 27 July.
Tullow is also applying to the UK Listing Authority (www.fsa.gov.uk/pages/doing/ukla) to admit the extra shares to the Official List (they rank pari passu with previous shares) and to the London Stock Exchange plc (www.londonstockexchange.com) for the shares to be admitted to trading, also expected for 27 July. The same would apply to the Irish Stock Exchange (www.ise.ie).
Aidan Heavey, chief executive, said in a company announcement: “I am delighted by the success of our offer on the Ghana Stock Exchange, the largest primary share offer ever completed in Ghana. Ghana remains at the heart of Tullow’s investment decisions and underpins our long-term future in Africa.
“I would like to welcome all new shareholders, including Ghana’s National Basic Pension Scheme, to Tullow and thank them for their investment in the company. I look forward to updating all our shareholders with news of our progress, both in Ghana and beyond, over the coming years.”
BLOG PREDICTION: Look out for the rise of African financial institutions such as pension funds and life assurance. What do you think?

Vital impact PE fund raises $250 m and invests in Angolan housing

Tom Minney — Wed, 04 May 2011 20:23:31 +0000

A private equity fund that invests in housing, agriculture, education and health says it has raised more than $250 million for its first fund, Vital Capital Fund I. Eytan Stibbe, founding managing partner at Vital Capital Investments LP (www.vital-capital.com) and chief investment officer was reported as telling Bloomberg yesterday (3 May) the fund aimed to invest in Angola, Ghana and Mozambique.
The fund includes retired U.S. Army General Wesley Clark among its advisory board members, is a proponent of “impact investing,” a strategy that places capital in ventures with social or environmental goals.
Stibbe says Vital Capital has already invested in Kora Housing, a developer of affordable housing in Angola. It aims to raise another $250 million.

Mobius blogs on why he likes Africa

Tom Minney — Sun, 24 Apr 2011 23:34:04 +0000

From the blog of Mark Mobius of Templeton Investments:
“While Africa does have challenges, I am encouraged by another side of Africa that is gradually emerging with the development of capital markets, consumerism and technology.
I believe the opportunities for the development of Africa’s markets are appealing primarily because of the strong growth numbers now emerging out of the continent.
Africa is expected to grow more than 7% annually in the next 20 years, due to an improving investment environment, better economic management and China’s rising demand for Africa’s resources. More than 100 African companies have revenues in excess of $1 billion. Africa also has impressive stores of resources, not only in minerals but also in food — 60% of the world’s uncultivated arable land is found in Africa. As global demand for hard and soft commodities continues to grow, I believe Africa is in an enviable position with its vast natural resources. The potential for long-term growth in consumer-related areas is also very attractive, with around 1 billion inhabitants on the African continent. These are people, just like many others all over the world, with aspirations to own their own homes and buy possessions such as cars, refrigerators, washing machines and the like.
Within Africa, Nigeria is one of the frontier markets that I like. The country has a population of about 155 million people. It is rich in oil and gas reserves and raw materials such as iron ore, coal and bauxite. In addition, its climate and large areas of fertile land lend themselves favorably to agriculture. Nigeria’s economy has benefited from strong commodity prices; it is estimated to have grown 7.4% in 2010 and is forecasted to grow 7.4% again in 2011. The highly-anticipated Nigerian presidential election may be seen by many as a measure of the country’s progress and stability despite the clashes and unrest running up to the election. Our local sources remain confident about the elections overall and are not expecting any significant derailing event. We share this sentiment for the most part, given the current positive economic environment, fueled by high oil prices, as well as more tangible reforms in the country. Moreover, banks in Nigeria are particularly interesting. In our view, the government’s recent bailout of banks has made the nation’s bank stocks cheap, creating some very interesting investment opportunities.
I also see a lot of potential in markets such as Ghana and Kenya. Ghana was the first sub-Saharan country in colonial Africa to gain independence. Although it endured an extended period of military rule, a new constitution and multi-party politics were introduced in 1992. Currently, Ghana is seen by many as one of the most politically stable democracies in sub-Saharan Africa. We are excited about the prospects for consumer-related sectors in this market, given its relatively young and dynamic population of more than 20 million. The country is also rich in natural resources such as oil and gold. Oil production in the offshore Jubilee field commenced in December 2010 and is likely to make a significant contribution to the country’s economic growth going forward. Of course, related investment in infrastructure is also likely to require financing, so we are looking closely at the financial sector as well.
The Kenyan economy appears to be doing well at the moment. The post-election violence in late 2007 and early 2008 took many by surprise, but it culminated in the establishment of a coalition government and the adoption of a new constitution in 2010, creating a solid foundation for future stability and growth. Kenya’s position on the east coast of Africa allows it to act as a hub for trade and investment flows from the east into the rest of the continent. Exports, predominantly tea and horticultural products, have recovered strongly, and the tourism sector is also seeing a strong rebound in the form of incoming foreigners.
There are also many challenges to investing in Africa.”

JSE Africa Board launches advisory committee to boost appeal

Tom Minney — Mon, 11 Apr 2011 18:03:00 +0000

So far, South Africa’s JSE Ltd (www.jse.co.za) securities exchange has achieved limited success with its Africa Board, aimed to encourage dual-listing of leading African equities on the JSE as part of a strategy to help capital markets development. On 8 April the JSE Executive appointed an advisory committee (Africa Board Advisory Committee) to boost the JSE Africa Board, part of the main equities market, to achieve its mission and strategic objective to provide a world-class stock exchange platform and help attract capital to the African continent.
The committee was launched in Accra, Ghana, and comprises 9 members from several African countries. Membership of the Advisory Committee will also grow and change over time. The chair is Nathan Mintah, previously a partner at private equity firm Kingdom Zephyr Africa Management Company and having over 18 years’ of investment banking and operating experience. Bolaji Balogun, CEO of Chapel Hill Denham Group, Nigeria is another member.
The task of the committee is to promote the business, goals and objectives of the JSE Africa Board to the main stakeholders of the investment community, including issuers, investors, service providers (i.e. banks, auditing firms, legal firms etc), governments and regulators. The committee is also mandated to advise on operational matters relating to the Africa Board, including reviewing the strategy and development of relevant new products that facilitate capital flows into Africa; advise from time to time on any proposed amendments and/or improvements to the JSE Africa Board model; assist business development efforts by facilitating key meetings in jurisdictions where Advisory Committee members have influence; offer advice on protocol, regulatory interpretation in different jurisdictions and assist in sourcing funding for the operations of the Africa Board.
Speaking at a media briefing in Accra on 8 April, Maureen Dlamini, Executive Head of the JSE Africa Board said: “The Africa Board Advisory Committee will help us achieve the objectives espoused by the JSE Africa Board that include attracting foreign direct investment to Africa in order to provide the finance necessary for development, and to allow the people of Africa to share in the African growth story.”
Mr Mintah said his appointment as Chairperson of the advisory committee is a timely and important challenge: “We need a concerted effort to successfully promote the growth of capital markets on the African continent and the JSE Africa Board is the ideal platform to achieve this goal.”
Dlamini said the world has become aware of the business opportunities in Africa. “The JSE Africa Board is ready and able to provide African companies that have pan-African strategies with a springboard to increase their footprint in Africa, using a trading platform that is widely respected,” she says.
The JSE, which operates Africa’s largest stock exchange, has had two listings since creating its Africa board in 2009. Trustco, a micro financial services group, has seen a 20% boost in its share price since it was listed in February 2009. Wilderness Holdings, a Botswana-based ecotourism company, has climbed 8.7% since it listed in April 2010. Both companies have primary listings in their home markets.

Private equity firms invest $79 mn in telecoms towers

Tom Minney — Wed, 23 Feb 2011 10:58:12 +0000

Leading international private equity firms are investing $79 million to build and acquire mobile phone towers in sub-Saharan Africa. Investec Asset Management (www.investecassetmanagement.com), the International Finance Corporation (www.ifc.org, a member of the World Bank Group), and the Netherlands Development Finance Company (www.fmo.nl) are taking equity in IHS Nigeria Plc (www.ihsnigeria.net) which says it is the largest provider of telecommunications infrastructure in West Africa.
IHS is reported to have more than 2,700 towers under its management and is still expanding its ownership and leasing operations throughout Africa. It has subsidiaries in Ghana, Sudan and Tanzania and employs 800 people, according to the website and is listed on the Nigerian Stock Exchange. IHS Executive Director, Issam Darwish, said in a report on the website that the fund would enhance telecommunications services in the country by breaking current barriers in the sector. Investec made the money available via its African private equity funds. The transaction is subject to regulatory approval.
According to the report, Darwish said: “IHS is dedicated to partnering with operators and investors across the African continent and is thrilled to add the IFC, FMO and Investec Asset Management’s private equity fund to our shareholder base. Since 2001, the company’s core strategy has been to serve the growing needs of the telecommunications operators in Africa and enhance the quality of the network performance.
“The investors understand the unique needs of the growing telecoms sector and the changing competitive landscape. The additional financing package also includes up to $115 million of IFC-led senior debt, mezzanine and syndicated loans, which will allow us to continue our leadership role in providing managed and co-location services to mobile operators and users in Africa.”
Darwish said IHS intended to bring down costs, expand coverage, accelerate technology rollouts and improve the quality of service for subscribers in Africa.
Last October, Nigerian President Goodluck Jonathan had called for more investments in the telecoms sector as Nigeria sought to become Africa’s telecommunications hub.
Yvonne Bakkum, Director Private Equity, FMO, reportedly said: “Access to telecommunications continues to be essential for the economic and social development of Africa. IHS increases the efficiency and quality of existing networks and helps operators accelerate network expansion into rural areas. FMO is proud to contribute to this through our investment in IHS, alongside Investec and IFC.”
IFC is a member of the World Bank Group and the largest global development institution focused on the private sector in developing countries. Andrew Gunther, Senior Manager, IFC Infrastructure and Natural Resources in Africa and Latin America, said: “Broadening access to affordable mobile telecommunications services remains a crucial part of development across Africa. IHS’ track record of improving quality while reducing costs will continue to provide savings that benefit all constituents of telecommunications in Africa.
“With this investment, IFC is helping improve quality of service, expand network coverage, reduce deployment, operating and usage costs – while accelerating the innovation that governments and operators can deliver throughout Africa.”
Investec Asset Management is one of the largest third-party investors on the African continent. It was established in 1991 and has grown into an international business managing approximately $80 billion (end Sept 2010). Mark Jennings, Investment Principal, Investec Asset Management: “IHS has a 10-year track record of profitable growth, is led by an energetic and experienced management team which includes the founders of the business, and is poised for substantial further growth which the new funding will assist. We are pleased to be associated with this dynamic business and team.”
In October 2009, the IFC invested $100 million into Helios Towers Nigeria Ltd. (www.heliostowers.com), set up by Helios Investment Partners as reported on this blog. HTN builds and maintains a network of telecommunications towers and leases space to providers of wireless telecommunications services.

Jacana partners with Ghana’s Fidelity Capital Partners private equity manager

Tom Minney — Tue, 21 Dec 2010 14:56:57 +0000

Jacana (www.jacana.org), a UK-based group that supports emerging SME private equity firms in Africa, has launched its second investment, a strategic partnership with Ghanaian fund manager Fidelity Capital Partners Limited (www.fidelitycapitalpartners.com).
Jacana’s investment, announced on 13 December, will enable Fidelity Capital Partners to expand the senior team. Jacana will also provide hands‐on management support to the investment team and the portfolio companies ahead of the planned launch of Fidelity’s third fund in 2012.
Fidelity Capital Partners was founded in 1999 and is one of West Africa’s leading SME private equity firms. It manages two SME funds – Fidelity Equity Funds I and II – with a total of $32 million under management.
Stephen Antwi‐Asimeng, Senior Partner of Fidelity Capital Partners, commented in a press release: “We approached Jacana as a strategic partner because we believe that the combination of our local market experience and deal flow with their international expertise in private equity will be a powerful one which will enable us to scale new heights.”
Fidelity manages the funds on behalf of a number of investors, including Ghana’s Social Security and National Insurance Trust (www.ssnit.com) and Venture Capital Trust Fund (www.venturecapitalghana.com.gh), Netherlands-based Oikocredit (www.oikocredit.org) and social venture capital fund Sovec (www.sovec.nl), and leading development finance institutions (DFIs), such as FMO (Netherlands) SIFEM (Switzerland) and Finnfund (Finland).
Claude Barras, Managing Director of SIFEM and Ben Zwinkels, Senior Investment Officer of FMO, both Board Directors of Fidelity Capital, commented: “We believe that the combination of Jacana and Fidelity Capital will enhance returns for all investors and help us to achieve our development goals in Africa. We are excited about working together with Jacana and supporting both partners in their future growth.”
Jacana was founded by European private equity experts and its mission is to contribute to long‐term poverty alleviation by attracting public and private investment to SMEs in Africa and by partnering with and developing local private equity fund managers. Jacana adds capital and expertise and enables its partners to grow their teams, build their track records and raise larger funds. It is Jacana’s second partnership, following its investment in InReturn Capital, an East African SME investment firm, announced in June 2010 (as reported on this blog.
The partnership with Fidelity Capital enables Jacana to extend its footprint in Sub-Saharan Africa and further develop its track record in building successful SME private equity firms.
Jacana was founded in 2008 by a group with substantial experience in the private equity and venture capital industry in Europe. Its co‐founders include Stephen Dawson (a pioneer in the UK VC industry 30 years ago and a co‐founder of Impetus Trust, a venture philanthropy charity), Lord Joel Joffe (a philanthropist with a background in human rights law, a successful entrepreneur and former Chairman of Oxfam), Connie Helyar (a successful entrepreneur in fund administration for private equity) and Simon Merchant (a successful entrepreneur and VC investor). Jacana’s vision is the creation of a sustainable, responsible and robust SME growth capital industry in Sub‐Saharan Africa that supports local SMEs, fuels economic growth, creates employment and thereby makes a major contribution to the reduction of poverty in Africa.
Fidelity Capital Partners Limited was established in February 1997 and started business in November 1999 as a venture capital and private equity fund manager and corporate finance advisor. Fidelity Capital’s shareholders include its management, local and international private investors, and development finance institutions. It is also the local investment partner of Africinvest Capital Partners Limited (www.tuninvest.com), a Pan‐African private equity fund management company.

Aureos Africa Fund invests $10 mln into HFC, backs expansion and SME lending

Tom Minney — Thu, 18 Nov 2010 23:11:04 +0000

Aureos Africa Fund (“AAF”) has completed a US$10 million investment in HFC Bank Ghana Ltd (www.hfcbankgh.com), a commercial and retail bank. The investment in HFC will help the bank remain strongly capitalised as it continues the steady expansion of its branch network and of its lending to businesses and consumers.
AAF is managed by Aureos Capital Ltd (www.aureos.com), a private equity fund management company specialising in investing in small- and medium-sized businesses in emerging markets. This is the fund’s 12th investment.
HFC Bank provides microfinance and mortgage finance services, as well as conventional commercial and retail banking and corporate advisory work.
Jacob Kholi, Managing Partner of Aureos in West Africa, comments in a press release: “Whilst HFC is already a well established, well managed and profitable bank, there is significant scope for expansion. We think that a sensible and sustainable growth in their lending and deposit-taking activities would be a real benefit to both Ghanaian businesses and the wider Ghanaian economy.
“Our aim is to help HFC become one of the leading banks in Ghana and ensure it has the kind of financial strength needed to provide the loans and other banking products that are often in such short supply in this region.”
He adds that, as in many other regions, Ghana’s small- and medium-sized enterprises have been hindered from expanding by lack of adequate bank financing.
Asare Akuffo, Managing Director at HFC comments: “In recent years we have enjoyed rapid growth and are now arguably the most diverse financial institution in Ghana. However, our focus has always been on providing the best possible service to our customers. Thanks to this investment by Aureos we hope to be able to expand our product offering to even more potential customers across the wider West African region. We are delighted to welcome them on board.”
HFC Bank was formed in 1990 and listed on the Ghana Stock Exchange (www.gse.com.gh) in 1995. The bank existed as a mortgage finance institution until 2003, when it expanded into commercial and investment banking. It has 23 branches across Ghana, and with the investment from AAF the bank plans to open additional branches as it strategically expands its reach.
Aureos explains that their investment in HFC will also allow the bank to improve on its already robust systems, to improve operational efficiency, and to strengthen its Human Resources capacity.
Jacob Kholi adds: “HFC is fully committed to the principles and practice of good corporate governance. One of their key aims is to further improve their processes and operations to ensure they meet ISO banking standards, which include quality of communication with customers and commitments to data privacy. Aureos’ commitment to good practice, and expertise in these areas, will help HFC do that.”
Aureos was set up in 2001 and has increased funds under management to over US$1.2 billion and extended its geographical footprint to over 50 emerging markets, covering Asia, Africa and Latin America through establishing 16 regional private equity funds.
Institutional investors, bilateral and multilateral development finance institutions, pension funds, sovereign wealth funds, fund of funds, family offices and foundations and high net worth individuals are among the investors into Aureos’ funds.

More from Africa investor awards

Tom Minney — Mon, 27 Sep 2010 21:49:28 +0000

Other Africa investor (www.africa-investor.com) Index Series Awards 2010 announced on 20 September included listed companies, socially responsible companies, most innovative capital markets regulator, best stockbroker, best research and best initial public offer. Africa investor is a leading international investment research and communications group and the gala awards ceremony was held on the trading floor of the New York Stock Exchange. The awards included:
• Best-performing Africa investor 100 company – Ghana Commercial Bank
• Best-performing Africa investor 40 company – Equity Bank Kenya
• Best-performing Africa investor Sri30 Company – Safaricom (also Kenyan)
• Best Performing Africa investor SRI 50 Company – Zambia Sugar.
• Most innovative African stock exchange – Ghana Stock Exchange
• Most innovative capital markets regulator – Financial Services Commission of Mauritius
• Best Africa fund manager – Coronation Africa Fund
• Best Africa investment bank – Renaissance Capital
• Best Africa research team – Standard Bank
• Best African IPO – Juhayna Food Industries Egypt.
• Best-performing broker in Africa – Auerbach Grayson
• Best risk-adjusted performance by an African/South African hedge fund – Scipion Capital.
Africa investor says its Index Series Awards are “the only international, pan-African awards that recognize and reward Africa’s institutional investors, stock exchanges, best-performing listed companies, stockbrokers and capital market regulators.”

Ghana awarded “most innovative” African stock exchange

Tom Minney — Sun, 26 Sep 2010 21:49:59 +0000

The Ghana Stock Exchange (www.gse.com.gh) has announced that it was awarded the prize as “Most Innovative African Stock Exchange for 2010” at the Africa investor (Ai – www.africa-investor.com) annual Index Series Awards. According to a press release from teh exchange, the award was made at the New York Stock Exchange (www.nyse.com) on Friday,17 September.
The awards assessed performance between April 2009 and April 2010. The GSE came first out of 7 African stock exchanges nominated.
The Ai Index Series Awards are the pan-African awards that recognize and reward Africa’s best-performing institutional investors, stock exchanges, listed companies, stockbrokers and capital market regulators. Hubert Danso, Vice Chairman and Managing Director of Ai said in a press release: “We are again delighted to have the opportunity to profile African capital market success stories. The quality and quantity of entries received this year is testament to Africa’s increasing appeal to the global investment community”
The Ai Index Series Awards ceremony coincided with the annual Ai Index Series Summit held in association with NYSE Euronext in New York. This brought together international investors, African CEOs, pension funds and capital market professionals from all over Africa and across the US to explore investment partnerships in African-listed equities.