Black Rhino, Dangote Industries commit $5bn to Africa

Black Rhino, a portfolio company of Blackstone Energy Partners, and Dangote Industries will jointly invest $5 billion over the next five years in energy infrastructure projects across sub-Saharan Africa with a particular focus on power, transmission, and pipeline projects, the New York private equity firm said in a statement on Tuesday.

The 50/50 partnership is the first to be announced since Blackstone’s energy-focused private equity business said at the end of July it would be backing Black Rhino, an African infrastructure development company, with the aim of identifying, developing, financing, constructing and operating large-scale energy infrastructure projects in the region, where 70 percent of the population does not have access to electricity.

“For too long, inadequate energy infrastructure in Africa has been a major obstacle to the continent as it seeks to fulfill its economic potential,” Dangote Industries’ founder, president and chief executive Aliko Dangote said during the US-Africa Leaders Summit, hosted by the Obama Administration in Washington, DC, where the announcement of the partnership between his company and Black Rhino was made.

“We have confidence that the critical infrastructure projects that the Dangote team and Black Rhino will jointly pursue will play a meaningful role in the development of economies across Africa,” Blackstone’s chairman, chief executive and co-founder Stephen Schwarzman said.

According to the statement, Black Rhino and Dangote Industries will not only seek to help boost African economies through joint investments but will do so by pursuing projects that focus on sustainable development and social responsibility, with an effort to involve local communities and fully adhere to environmental and safety standards.

Headquartered in Lagos, Nigeria, Dangote Industries’ businesses include manufacturing, logistics, commodities trading and real estate across 14 African countries.

Black Rhino, which was founded in January 2012 by Brian Herlihy, has a project development pipeline that includes projects in Djibouti, Ethiopia, Nigeria and South Africa. In addition to investing in the company, Blackstone Energy Partners is helping build the Black Rhino team and last month announced the appointment of Mimi Alemayehou as managing director and a member of the executive committee. She will also serve as an executive advisor and chairperson of Blackstone Africa Infrastructure.

Blackstone’s presence in Africa also includes its portfolio company Sithe Global, through which it is a lead investor, alongside the Aga Khan Fund for Economic Development, in the 250-megawatt Bujagali hydropower plant in Uganda. The asset manager is also a founding investor in Kosmos, an oil and gas exploration company that has worked with the government of Ghana and Ghana National Petroleum Company to develop the deep-water Jubilee oil field.

The New York-listed investment firm’s asset management businesses, with almost $300 billion in assets under management, include investment vehicles focused on private equity, real estate, public debt and equity, non-investment grade credit, real assets and secondary funds.

As for the energy sector specifically, Blackstone has since inception invested approximately $7 billion of equity globally.