Nigeria’s Eczellon Capital Investment bank and other West African markets have launched West Africa focused Private Equity (P.E) Fund that is looking to get $250 million, in terms of size, in a bet on growth prospects in Africa’s largest economy.
According to Diekola Onaolapo, CEO of Eczellon Capital, the fund will take seven-years, oif which is has targeted to have a compound annual growth rate of 30 percent.
He told local nigeria’s local media that: ‘We are targeting deals in energy, infrastructure, oil and gas, power generation and a few other active growth sectors in Nigeria. Assets are much cheaper now with the recent stock market sell-off and negative sentiment. We are not short term oriented so we take the view that this is a good time to take positions.’
The fund, which is at an advanced level of commitment from investors, is expected to close between Q2 and Q3 of 2015.
The responsibility of management of the fund lies on Eczellon International, with activities overseen by an investment committee that has Florin Vasvari, a professor and a non-executive director of Eczellon Capital, as one of its members. Vasvari teaches private equity, finance and accounting at the London Business School, United Kingdom.
The Fund will be for identified investment opportunities and already packaged deals. The Fund will invest in and support unlisted enterprises with high capital growth potentials over the medium to long-term (ranging from three to five years).
Lami Adekola, head, investment banking at Eczellon Capital predicts that the fund has a potential flow of $1 billion in the power sector alone
He said that: “the role of P.E in the second phase or refinancing of power assets cannot be overemphasised. We are already working with three generating companies (GENCOs) who we are looking to raise capital for refinancing of earlier loans…however we cannot fund all of that on our own and will be co-investing.”
The CEO further said that the company has already assisted Nigerian companies in securing over $140 million in committed capital in 2014 alone, and seeks to further expand access to finance for its focus sectors in the coming years with the launch of this new Fund.
Discussions and commitments are already at advanced stages with key prospective investors in the fund, which include Insurance Firms, Pension Funds, Development Finance Institutions and other Qualified Institutional Investors, as well as High Net worth Individuals in Nigeria and across the Middle and Far East.