Nigeria: Latest News
Kurt Davis Jr., 2:00 am AFKI Original
Short-term volatility and uncertainty in the African growth story create opportunities for hedge funds. Hedge funds generally operate flexibly than private equity, and they have the creativity to generate bond-like returns that outpace inflation. Critics say hedge funds have limited liquidity in an opaque world. The riskiest play — but with big returns — is in agriculture and land. Where land is for sale in Africa, investors are making a play for a limited resource, especially when it’s arable, ripe for production or ideal for commercial and residential construction.
Staff, 2:42 pm
Huarong Zhang is chairman of Huajian Group, whose Chinese factories make shoes for Ivanka Trump, Nine West, Michael Kors and other Western brands. This week, Zhang brokered a $ 1.5 billion deal with the Nigerian government to build a shoe factory Nigeria. Huajian already has a shoe factory in Ethiopia manufacturing more than 2,000 pairs of shoes a day that are exported to the U.S. and European markets. Huajian produces 12 million pairs of shoes a year, mostly high-end brands for European and U.S. markets. They typically sell for at least $100 a pair in the U.S.
Peter Pedroncelli, 5:36 am
The World Bank Group has committed to supporting the growth of Africa’s digital economy with the launch of XL Africa, a business acceleration initiative that will provide a raft of benefits for the 20 most promising startups in sub-Saharan Africa over the next five months. African digital entrepreneurs will have an opportunity to be mentored by various global specialists, increase their visibility on the continent and receive access to corporate partners and investors.
Dana Sanchez, 4:53 pm
An IPO today on the Johannesburg Stock Exchange introduced a new option for investors who want to add African exposure to their portfolios. The AMI Big 50 ex-SA ETF offers 50 African blue-chip companies outside South Africa. The IPO is a world first – an ETF offering exposure to a pan-African index that excludes South Africa. “A lot of people do worry about the liquidity risk, but being an ETF means that there is a secondary market on the JSE which allows investors in smaller quantities to trade exposure in and out of Africa,” a stakeholder said. The ETF is managed by Cloud Atlas, which plans to launch two more Africa-focused ETFs by July.
Peter Pedroncelli, 4:46 am
Nigeria national team coach Gernot Rohr has publicly stated that a return to the Super Eagles is a possibility for internationally retired goalkeeper and former captain, Vincent Enyeama. The German coach opened the door to his return, making it clear that he is welcome to reignite his national team career if he is willing to work hard and be humble. The Nigerian shot-stopper decided to retire from the Super Eagles in October 2015 following the revelation that then coach Sunday Oliseh had chosen for Ahmed Musa to captain the side, rather than the veteran keeper.
Staff, 2:57 pm
At a time when aid is under political pressure, a bold approach is needed to maximize the efficiency of donor resources. While governments in Africa are spending more on public infrastructure themselves, outside finance is still required, especially for regional projects — rarely a priority for national governments. Aid from Africa’s traditionally generous foreign donors is set to shrink. There may be a solution. The “Big Bond” is a strategy for leveraging foreign aid funds in international capital markets to generate financing for massive infrastructure investment.
Staff, 8:36 pm
Pension funds are good news for infrastructure projects in Africa. Development banks and private equity funds are targeting pension funds in Africa as sources of investment capital. Four African countries hold 90 percent of Africa’s pension fund assets. Despite challenges, African pension funds are likely to make a substantial impact on infrastructure investment in the next few years. One promising trend is the rise of regional funds targeting pensions. They’re making a new source of African capital available to address the region’s infrastructure deficit.
Staff, 12:01 am
The fall in African private equity investment in 2016 could be a short-term blip. Among the losers was US-based Carlyle, one of the world’s winningest investment firms. Carlyle invested $147m in Nigeria’s Diamond Bank in 2014. The bank’s market cap fell by 90% over the subsequent two years. Bob Geldof’s PE firm 8 Miles just invested in Blue Skies, a British fruit firm that operates in Africa. Utilities including telecoms were the most popular target for private equity investment in 2016. West Africa was the most active region.
Reuters, 1:00 am
Africa’s informal alcohol market is about four times bigger than its $11 billion commercial market, analysts say. Home brews have a strong tradition rooted in centuries-old African rituals. AB InBev needs to develop products affordable enough to tap the informal beer and alcohol markets, says InBev’s new Africa head. AB Inbev’s big rivals in Africa – Heineken and Diageo – have also launched lower-priced drinks made with local ingredients that are affordable for more people.
Kurt Davis Jr., 9:54 am AFKI Original
As commodity prices have fallen, African manufacturing has increased leverage — and the attention of investors — to garner more foreign investment. Tanzania is probably one of the easier bets if you are following the crowd. Success stories include Kenya-based Catalyst Principal Partners, an East Africa-focused private equity firm which invested in Zenufa Laboratories, a leading Tanzanian pharmaceuticals manufacturer. Catalyst also invested in Chemi Cotex, which makes toothpaste, skin and hair products. Both involve non-food and beverage consumer goods that are manufactured locally. Both have taken market share due to quality products and competitive pricing.
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