Commercial News from Africa
Key commercial and political activity in Africa for private equity investors by DCE Partners, UK Private Equity advisors to Atta.
Executive Summary: Private equity investors have long looked to four large emerging markets for big returns: Brazil, Russia, India, and China. However, the BRICs today don't fit the fast-growth described in the original 2001 paper that coined the widely used acronym. Each BRIC economy in some kind of trouble and private equity firms are increasingly putting their investment capital to work in other less-developed markets, especially sub-Saharan Africa. This, with a view for better returns. Money invested in non-BRIC emerging markets increased 18 percent last year, reaching a five-year high of US$11 billion and representing 44 percent of total capital invested in emerging markets, according to a recent study by the Emerging Markets Private Equity Association - total capital invested in the BRICs declined 20 percent between 2012 and 2013 and was 38 percent lower than in 2011 - virtually all private equity firm clients expect to increase their exposure to emerging markets over the next 24 months, according to the same report.
Poland's richest man shows interest in Ethiopia. With an estimated net worth of US$3.9 billion, Jan Kulczyk is focused on opportunities in global emerging markets with four strategic sectors namely mineral resources, energy, infrastructure and real estate. Kulczyk is looking to expand his investment portfolio in Africa and, apart from Ethiopia, he has plans to invest in the newly-formed country, South Sudan. In total he has invested US$1.1 billion in Africa, having bought a gold mine in Namibia, a coalmine in Mozambique, fertilizer production in Nigeria, iron ore in Congo-Brazzaville and gas fields in Tanzania.
Uganda, Kenya to build world's longest heated oil pipeline. Uganda and Kenya are expected to build a crude oil export pipeline in the coming years - it will be the longest heated such facility in the world. Both countries have agreed to build the pipeline and have commenced a comprehensive study on the pipeline. The export pipeline route on the Kenyan side is expected to run mostly underground, over 850 kilometres from the Lokichar basin to the coast. Kenya is to construct the pipeline from Lokichar basin while Uganda is expected to construct its part of the pipeline from the Lake Albert rift basin to link up with the Kenyan pipeline and another from South Sudan to Lamu.