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South Africa: Private Equity Firm Seeks Openings in Country
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Business Day (Johannesburg)
23 July 2008
Posted to the web 23 July 2008
Sure Kamhunga
Johannesburg
PRIVATE equity investment firm Kingdom Zephyr Africa Management said yesterday it was scouting for investments in SA with a potential to yield high returns for its shareholders, who include Saudi billionaire Prince Alwaleed bin Talal bin Abdulaziz.
Zephyr partner Panos Voutyritsas said the company had raised $325m to invest across Africa, and projected capital commitments of up to $500m by year-end. Because of the sheer size of its economy, SA would play an important role, both in terms of direct investment opportunities and in partnerships with local firms seeking to expand in Africa.
Voutyritsas would not specify the sectors in SA the company was interested, but said Zephyr's target interests included companies in high-growth industries, excluding gambling, defence and alcohol, among others.
Formed in 2004, the company is a joint venture between Kingdom Holding, an investment company controlled by Abdulaziz, and Zephyr Management LP, a US private equity fund manager specialising in emerging markets.
The company believes the wave of democracy and economic reforms in Africa presents valuable opportunities to invest in such growth sectors as financial services and telecommunications.
Voutyritsas said the $325m was raised through the company's Pan-African Investment Partners 2 fund, a follow-up to $122,5m raised in November 2004.
"The investment strategy remains essentially the same, but the investment sizes will be markedly higher.
"As the largest economy on the continent, SA is expected to play an important role in our second fund, both in terms of direct investment opportunities in this market and in terms of partnerships with South African companies expanding north," he said.
Potential investments in SA would be evaluated against opportunities elsewhere in Africa, particularly from a strategic, risk and reward perspective.
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"Considering this market is well covered from capital providers, we expect our activity in SA to stem from our select close relationships in this market," Voutyritsas said.
IF I was an investor I would look elswhere to put my money.
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