Metier Capital Growth Fund II completed further closings to June 2016, raising in excess of ZAR2.5bn, with further commitments expected by final closing.
The fund is the successor fund to the Capital Growth Fund of 2006/7 which invested in eight portfolio companies, the majority in value now realised.
The fund will focus on private equity investment in buy out and growth capital transactions in South, Southern and Sub-Saharan Africa. Investments are targeted in sectors set to benefit from demographic trends such as population growth and increased urbanisation, and the accompanying consumer spend from the emerging middle class. The fund will also target investments in sectors which are advantageously exposed to increasing intra-regional and international trade, and also where strong management teams are able to lead regional expansion of their businesses. The fund strategy targets exposure of 50% to Sub-Saharan Africa, excluding South Africa.
The fund has already concluded four investments in the retail, out of home dining, healthcare and industrial services sectors.
The fund was invested in by both international and South African based investors including significant commitments from international developmental finance investors who were motivated by the Metier team’s focus and track record on development impact while targeting top quartile private equity performance and outperformance of public market benchmarks.
Investors included, DEG - Deutsche Investitions und Entwicklungsgesellschaft mbH (the German development finance institution), Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden N.V. (FMO, the Dutch development bank), the International Finance Corporation, Proparco (a subsidiary of the French Development Agency (AFD)), frontier market investor Sarona and Averroès Finance III, a fund sponsored by Proparco and Bpifrance, the French public investment bank. The South African based investors include institutional investors such as Investment Solutions, MMI Group Limited, local pension funds and asset managers. The Metier team also made material investment commitments in the fund equivalent to an institutional commitment.
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