The PE firm plans to raise US$500mil in the coming months and has garnered US$140mil in its first closing, said Alterra's Sangudi said. — Reuters
LAGOS: A team spun out of Carlyle Group Inc says it’s got backing from the founders of the US private equity (PE) firm and Nigerian billionaire Aliko Dangote for a new Africa-focused fund.
Carlyle co-founders David Rubenstein and Bill Conway are among investors in the Alterra Capital Partners fund, partner Genevieve Sangudi said.
The PE firm plans to raise US$500mil in the coming months and has garnered US$140mil in its first closing, she said.
While large investors, including Carlyle, Blackstone Inc and KKR and Co, have retreated from Africa, smaller firms are seeing opportunities as startups mushroom to fills gaps on a continent that lacks financial and logistical infrastructure.
Alterra plans to invest in the telecommunications, technology, logistics, healthcare, consumer and retail sectors, Sangudi said.
“This is an excellent time to put money to work in Africa as many of the current macro themes provide attractive potential investment opportunities,” Sangudi said.
“For example, the power challenges across Africa provide opportunities to invest in private distributed power solutions, while technology continues to drive Africa digital transformation at a rapid pace.”
Other investors in Alterra’s fund include Standard Bank Group Ltd, International Finance Corp, Norfund AS, Germany’s Deutsche Investitions-und Entwicklungsgesellschaft GmbH and Allianz SE’s AfricaGrow fund, Sangudi said.
In mid-2020, at the height of Covid-19, Washington-based Carlyle spun off its US$700mil sub-Saharan African fund to its local investment team. The new firm, called Alterra, took over management of Carlyle’s assets.
Alterra, which also includes two other founding partners, Eric Kump and Bruce Steen, has exited six companies and managed to return about US$600mil to investors, said Sangudi. The team has invested about US$1bil in 23 companies in Africa.
Recent sales include logistics firm J&J Group to DP World Ltd, oil and gas company Assala Energy Holdings Ltd to Maurel and Prom SA, agri-tech company Tessara Ltd to Agrofresh Solutions Inc, and Global Credit Rating Co to Moody’s Corp.
Alterra has a team of 17 people, including two partners, Paul Maasdorp and Bryce Fort, who joined from Africa-focused private equity group Emerging Capital Partners LLC.
The firm will face competition from other Africa-focused companies such as Helios Investment Partners LLP and Adenia Partners Ltd, which have doubled down on the continent, adapting their operating models and building local capacity.
Last year, firms raised about US$7.6bil for African investments, according to the Africa Private Capital Association.
About 82 exits were recorded, the association said. — Bloomberg
