Re: THE NEW PARTITION OF AFRICA BY PRIVATE EQUITY FIRMS...INTERESTING

Sir it all started with the genocides in Rwanda and Burundi. Those who survived it changed the official language of the country from French to English. Rings a bell? The Arab spring turned winter and the Ivory Coast saga etc. etc. was meant to signal to Africans that they do not control their territories but the West. They can't stand the fact that Mugabe defied them and has gone on to rule his Zimbabwe which we were made to believe was going to collapse within the next second. What has suddenly happened there that all the media hypes have suddenly gone dead?
When they told us that our econony di craze instead of book peepo like wuna for America for helep we tok say na lie wuna instead agree wit tiff kwakanda dem say na true and dem come take all better business wey we bin get and drive all man fo wok. After one year Bolore wey na yi get cameroun announce say camrail don make plenty profit.Old news Mishe Fon. This had been going on since. We managed to save the CDC from their pangs but even then they still got part of it through another cameroonian crook called Ndawara or what I don't know. Do you know why in all of the Southern Cameroons struggle SCARM is the hated child? We used to seat analize these situations and attacked the gov't of la republique directly. Some of us who thought that we were too ungentlemanly in our approach sold us out to the regime for 2 pence yet they have moved the struggle backwards. The port of Kribi would not have been developed ahead of the Victoria deep sea port because we
fought tooth and nail to show to the world that that was the place to develop. Sonara will forever be the sacred cow of the Bassas' but of course who did they use to quieten us? They appointed Ebong Ngole, Chairman of Sonara as if to appease the Southern Cameroonians and not as usual because of some track record of competence but because they were trying to divide and rule us. They linked up the SCARM fight with the SDF which we in SCARM also consider as an arch enemy of the people of the Southern Cameroons given their postulations and readinness to collaborate with the gangsters running the triangle. There is a lot to say on this divide and rule saga. Dorothy Njeuma as Vice Minister of Education accused the graffi peepo during the fight to liberate the angl-saxon education from the pangs of the frogs (GCE) stated that it was the grasslanders who wanted her out of government that were leading that fight. Who has been the greatest beneficiaries in that
saga after so many people lost limb and liberty? She did not end it there when she was appointed again by her cohorts to Lord it over an institution they fought against, she reintroduced tribalism and killed the very essence of the Angl-Saxon University we fought for. Remember late Professor Obenson who "died" on the Yaounde Douala road; Bate Besong?
We all fought for the creation of the Anglo-Saxon university and Prof. Obenson advised us in SCARM on how they started Lagos University and how we could use the same method to achieve our own. When we set out to do this, the govt. of la republique caught wind of it and hastened to create what today is seemingly an anglo-saxon University. Frogs are given one year of grace to study the English language and enter the university while we limit our own children who studied all through their lives in the Queens language an opportunity to study in the so called anglo-saxon university. Take note that Southern Cameroons children enrolling in "Frogs" university do not have the luxury to study French before studying there. Even down to students affairs, Njeuma and her successor in title are still using the same antiquated methods to move on the agenda of our colonisers. NW/SW didvide is their sing song and the university becomes a shadow of itself. I consider
Achidi Achu, Mafany Musonge, Fru Ndi, Njeuma and a host of others as the agents of colonisation. They shall pay some day. The incumbent boot lickers of La republique du cameroun are worse than the Foncha's and the Muna's of yesteryears who could conviniently couch their betrayal of a people under the canopy of lack of education.
Re-partitioning of Africa might not be that bad though because the coloniser will not distinguish one graffi man from a nkwah man. God forbid it. Let us look at specific areas and fight the frogs and the rest shall follow, Not empty sloganism on the independence of the Southern Cameroons with no concrete actions to prove that we are serious. Drive away the frogs from our institutions and give us back our cherished anglo-saxon education. Sorry for this horrible prose it is unedited.
Amen
--------------------------------------------
On Thu, 5/6/14, 'Mishe Fon' via ambasbay <ambasbay@googlegroups.com> wrote:

Subject: THE NEW PARTITION OF AFRICA BY PRIVATE EQUITY FIRMS...INTERESTING
To: "CAMNETWORK list" <camnetwork@yahoogroups.com>, "ambasbay" <ambasbay@googlegroups.com>, "SHESA USA" <shesausa@yahoogroups.com>, "ACCDF" <accdf@yahoogroups.com>, "cameroon politics" <cameroon_politics@yahoogroups.com>, "mankonforum@yahoogroups.com" <mankonforum@yahoogroups.com>
Date: Thursday, 5 June, 2014, 7:45

While we spend an inordinate
amount of time trying to excoriate, character assassinate,
inflict as much damage as we can on our perceived, imagined
or supposed "enemies"; this is what the BIG BOYS,
yes "Heavy Weights" are discussing...about the new
PARTITION OF AFRICA. We are here "killing each
other" with the most vile uncouth vocabulary while a
few savvy guys are silently making a KILL in our backyard
AFRICA now considered as the fastest growing economy in the
world. While our country Cameroon is not remotely mentioned
in the discussion, we loose nothing in learning from the
best. Let me even start by asking a straight forward
question. How did War-torn Ethiopia, Rwanda and
Ghana emerge from a sinister World Bank listing
of "Very Poor and Indebted Countries" to
become the fastest growing African Economies
in front of our very own eyes? Where did Cameroon go wrong?
NA WHO GO PAY??????? Na which kanna badluck dis
norh?The article is rather long BUT it is a
scholarly paper not meant for the Fast and
Furious Internet Warriors, who are only reading
any article to extract negative points to
"Hammer" their "Frienemies" with. God
don surely tchakala we head.Mishe Fon
READ ON AND PONDER



"We see opportunity in a lot of different sectors
in many
different countries in Africa. As a result, we have invested
in a broad range
of sectors including diapers, bottled water, restaurants,
cell phones, rubber,
power and water, airlines, cable television, and tuna fish
processing."…Hurley
Duddey.


Private equity firms are
approaching investment in Africa from a
variety of perspectives, with different goals and
objectives. Some have
established histories in the region, while others are
relative newcomers.

There are a few
fundamental ways for institutional investors to
invest in Africa. They can invest directly in companies.
They can select one or
two funds investing in the region and invest in those
directly. They can
assemble a team internally to build a diversified portfolio
from the ground up.
Or they can use an intermediary firm that partners with
organizations with ties
to the region. For example, Blackstone, which entered Africa
about a decade
ago, invests primarily in the energy and power sector. It
does not maintain
region-specific funds, instead making investments from its
global private
equity and energy funds, which combined hold some $19
billion in capital.
Blackstone's investments in Africa, most of which have
been made through
Greenfield Development Projects, range from developing the
Bujagali
Hydroelectric Dam, a $900 million project in Uganda, to
investing in Kosmos
Energy in Ghana.


The Carlyle Group, on the
other hand, invests through funds that
are dedicated to a particular region or sector. Based in
both Johannesburg and
Lagos, they are investing mostly in medium- to large-sized
companies that are
growing as a result of rising demand from middle-class
consumers.


Fairview Capital Partners
is entering the African market through a
partnership with FMO, the Dutch Development Finance
Institution (DFI), which
has been investing in Africa since 1970 and in African
private equity funds
since the mid-1990s. Fairview takes a fund of funds and
co-investment approach
to investing in Africa, acting in essence as an arbitrager
for other investors.
A typical private equity fund invests directly in companies,
helping to grow
them to the point that their interest can be sold at a
profitable return to the
fund's investors. When there are a large number of these
funds, investors don't
always have the resources to do the due diligence needed to
build a strong
portfolio. That's where firms like Fairview Capital
Partners come in. Fairview
invests in the infrastructure and teams needed to do this
and, acting as a
general partner, raises capital from investors and then
serves as a limited
partner in the individual funds.


Emerging Capital Partners
(ECP) has launched a series of
Africa-focused private equity funds that each typically
invest directly in
eight to twelve African companies that it then helps develop
to a point where
they can be profitably sold. Since launching the business in
2000, ECP has
invested about $1.3 billion in over fifty companies in more
than forty African
countries. Notes Hurley Doddy, co-chief executive officer of
ECP, "We see
opportunity in a lot of different sectors in many different
countries in
Africa. As a result, we have invested in a broad range of
sectors including
diapers, bottled water, restaurants, cell phones, rubber,
power and water,
airlines, cable television, and tuna fish
processing."


Despite their strategic
differences, private equity investors
agree on what makes the African market attractive: a growing
population, a burgeoning
middle class, and improved governance and economic policies.



Africa was not as obvious
a play in 2000 as it is today, according
to Doddy. Nevertheless, many of the structural adjustments
that have made
investing there attractive were already under way in the
1990s, including
managing the debt and even more important, reducing the role
of government in
the economy.


The demographics are also
favourable. There are a billion
Africans. The workforce is growing, unlike much of the rest
of the world, where
both the workforce and the population are shrinking. In
fact, Africa will
eventually have a bigger workforce than China.



Demographics are one
important reason for Blackstone's power and
energy investments in Africa. There is and will continue to
be a tremendous
need for electrification, according to Senior Managing
Director Sean Klimczak,
who points out that the entire continent has the installed
energy base of
Spain, with twenty times as many
people.


The economic picture is
also increasingly bright. Compared with
countries like the United States, where long-run annual GDP
growth has been in
the range of 2-3 percent, the sub-Saharan Africa countries,
where long-run
annual GDP growth has been above 5 percent, look relatively
attractive in terms
of their ability to invest in large-scale power projects. As
a result,
Blackstone is focusing on transformative projects with good
developers. Says
Klimczak, "In Uganda we were able to double the amount of
available power. At
the same time, the country cut the cost of power by
two-thirds and expects to almost
double GDP growth."


David Marchick, managing
director at The Carlyle Group, points to
an intangible test his firm uses to gauge the attractiveness
of an emerging
market: Some 15 years ago, many Chinese citizens wanted to
come to the United
States, go to the best business schools, and then work here.
About ten years
ago, those same high achievers became interested in
returning to China. Over
the past four or five years, the same thing has been
happening with citizens of
sub-Saharan African countries. Says Marchick, "For us,
it's a sign of
confidence that the most talented people want to go back to
the countries where
they grew up because they see greater opportunity there.
It's a signal that
Africa is probably a good place to
invest."


Those signals have not
gone unheeded by the investment community
at large. Demand for well-vetted investment opportunities is
on the rise.
Institutional investors are clamoring for access to private
equity funds with
assets in Africa, but don't have the resources to make
informed decisions about
which funds are the best fit. For intermediaries like
Fairview, this is
probably the strongest indication that this is the time to
go into Africa.
Notes Kola Olofinboba, who heads up Fairview's African
Practice, "There is
something happening—there's a significant structural
shift and we think it's
there to stay. And yet when you look at the amount of
private equity capital
that has actually come into the continent annually over the
last ten years, it
has grown a little bit but hasn't really spiked. So we
think the opportunity is
still very early. And for people who get in now, the view
through the
windscreen is a lot brighter than what you see in the rear
view mirror."


Private equity firms entering
new markets must decide the extent
to which they will operate out of headquarters versus
stationing personnel in
the countries where they are making investments. Operating
from a central
headquarters is advantageous both because it is a less
expensive way to enter a
market and because it places decision-making closer to the
technical expertise
and resources that the firm has built up over time. On the
other hand, placing
"troops on the ground" helps firms conduct more
effective due diligence and
intelligence gathering.


Private equity firms vary
in how they deal with the
centralization/ decentralization issue. While about 10
percent of Blackstone's
investors are in Africa, the firm has no investment
professionals based on the
continent. The firm's professionals, who are stationed in
the United States,
Europe, and India, as well as other parts of Asia, are
responsible for
investment decisions globally. These executives log hundreds
of thousands of
miles each year as they vet different companies in Africa
and elsewhere.


In contrast, about 70 percent
of ECP's African investment
professionals are stationed in Africa, operating out of
seven offices across
the continent. These individuals work hand-in-hand with the
companies ECP has
invested in, learning their needs and helping them develop.
Migrating personnel
to Africa was a gradual process, notes ECP Co-CEO Doddy.
They started out with
most people based in Washington D.C, building the team and
strengthening
relationships. But over time, they found it was important to
move people closer
to the investment destinations.


This approach has made it
easier for ECP to perform due diligence
and manage its investments. Furthermore, because many of the
companies that the
firm is investing in are growth businesses that are looking
to expand to other
parts of Africa, having personnel stationed in various
regions across the
continent signals that ECP is prepared to support their
expansion.


Carlyle has also chosen
to station its investment personnel in
Africa. In fact, according to Marchick, 100 percent of the
people investing in
the region are from the region and live there, including
team members from
South Africa, Zimbabwe, and Liberia.


Despite Africa's significant
opportunities, there are also
considerable risks. Private equity firms manage these risks
using a variety of
strategies.


Fairview's fund of funds
approach allows the firm to build a
portfolio of investments, creating diversification for its
limited partners.
This helps mitigate the idiosyncratic risk of investing in
any single fund.
What investors pay for is Fairview's ability to pick the
best managers in a
particular market with the help of its sizable research
team.


ECP also spreads risk
through diversification, even within a
single fund. Each fund will typically invest in ten or so
different companies
in different sectors, operating in different
countries.


As with Fairview, ECP's
comprehensive due diligence makes it
possible to select the companies in each sector that have
the best potential to
perform well.


Carlyle manages risk by
sticking with what it knows. Says Managing
Director Marchick, "We tend to focus on transactions where
we can actually add
value, where there's some niche or some capability that
allows us to help that
business grow faster, expand internationally, strengthen
governance, or improve
financial management. In Africa we concentrate on sectors
where we can help
companies globally."


The firm uses this
approach in every region where it invests. As
one of the larger investors in China, Carlyle has managed or
invested in about
55 transactions totalling more than $4.5 billion; most of
these are minority
investments in growth-oriented companies. The firm plans to
take the same
approach in sub-Saharan Africa. An example might be a
family-owned business
that has grown to the point where it needs the financial
management,
operational management, and branding capabilities of a
larger company. Large
firms like Carlyle or Blackstone can bring to these
capabilities to the table
and help that company reach the next
level.


Not all private equity
firms choose to go it alone, especially
when entering a new market. Many of them opt for
co-investment, a strategy that
allows them to place larger bets without having to allocate
too much of the
fund's capital to a single transaction. Says Carlyle's
David Marchick,
"Co-investment is becoming a much more important part of
all of our
businesses—Blackstone, Carlyle, every private equity
firm." He points to two
main types of co-investment. The first is a private equity
fund's investors,
who are limited partners in the fund. These investors are
pension funds, high
net-worth individuals, and foundations. According to
Marchick, there is
increasing demand from these investors to co-invest
alongside their general
partners, so it is important for private equity funds to
provide these kinds of
opportunities.


The other type of
co-investment Marchick describes is done with a
competitor firm. For example, Carlyle has partnered with
Blackstone on a number
of transactions in the United States and around the world.
This is an important
strategy when the other firm offers complementary
capabilities that can benefit
the transaction. Marchick notes that it is especially
important to find a
partner with a similar investing philosophy or one with
similar objectives for
a particular project.


Blackstone's Klimczak points
to two other types of co-investors.
One is strategic partners. For example, when Blackstone
invested in The Weather
Channel, it partnered with NBC because of its valuable
knowledge of the
industry. For Blackstone's energy investments in Africa,
having a strategic
energy partner is equally critical.


Finally, in a region like
Africa, identifying a local partner can
be critical. Blackstone tries to partner with local
institutions and successful
entrepreneurs in the countries where it is investing. For
example, in Uganda,
the firm partnered with The Aga Khan, who has a stellar
track record and
reputation. Establishing local partnerships, especially in
the absence of
significant resources on the ground, is the best way to
ensure that the firm
truly understands the lay of the land in a particular
market.


Around the world, people are
beginning to see Africa as a market
with healthy prospects for growth. As a result, over the
last decade and a half
a number of non-traditional investors, including Chinese and
Indian companies,
have entered Africa. This trend has important implications
for private equity.


One consequence is that
private equity firms have a wider group of
candidates to sell portfolio companies to, once they have
built them up. At the
beginning of the century almost all investment and
development was being
financed by Europeans. Now, Indian companies have become big
players.


As ECP's Doddy
explains, Indian companies tend to be comfortable
with the income level that exists in many African countries.
Drawing on their
own success, they are looking to expand in a number of
industries. The same
holds true of many capital-rich Middle Eastern-based
companies, which are
especially comfortable expanding in North
Africa.


In China, by contrast,
investment tends to be more
government-to-government. The Chinese are not yet as likely
as the Indians to
buy and take control of an African company. But Doddy
believes this will
probably begin to change.


African companies
themselves, as they become more successful, are
pursuing expansion in other regions. Some South African
businesses are seeking
opportunities in the north, while Moroccan enterprises are
casting their sights
south. Doddy expects that in the next 10 years a broad range
of African
companies will begin expanding into other markets on the
continent.


Carlyle addresses the
issue by including a rigorous evaluation of
economic, social, and governance factors in its due
diligence process for
investments in Africa. According to Managing Director
Marchick, the firm's
investment criteria have so far been fairly consistent with
many of the
development goals of both the leaders in the region and
those of multilateral institutions.
For example, the firm's first investment target was a
distribution company in
the agribusiness sector. Focused on regional integration in
East Africa, the
company brings products from small farmers to the market,
creating greater
efficiencies. This business model accords well with
Carlyle's emphasis on
investments to promote the strength of the middle class,
upward mobility, and
regional integration. ECP's Doddy believes that private
equity firms have a
good reputation in Africa because they are fundamentally
growth investors
there. They are focusing on helping good companies that want
to get bigger and
better, provide services, and fill in some of the many gaps
in Africa.


While the private equity
community has not always been ahead of
corporate investors, it is clearly playing a leading role in
emerging markets,
particularly in Africa. If private equity investors prove
successful there,
they may promote even greater investment and economic growth
in a region where
profits can accrue not just to investors but to local
businesses and the people
whose livelihoods depend on them.

Written By:Harry Broadman, Senior
Managing Director PwC Emerging Markets
Management Consulting Leader

Martyn Curragh Principal
PwC US Deals Leader, Andrew
Cristinzio Partner PwC US Private Equity
Leader


Read Complete Article
Here: http://www.pwc.com/en_US/us/transaction-services/publications/assets/investment-in-africa.pdf


 






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