Harith General Partners (Harith), a pan-African fund manager based in Johannesburg, has acquired Frontier Markets Fund Managers (FMFML) from its shareholders for an undisclosed sum. The acquisition adds two funds worth a combined $1.2 billion.
The selling shareholders comprise: Standard Bank Group, the pan-African banking group; Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden (FMO), the Dutch development bank; and EMP Africa, an African fund manager.
FMFML has managed two funds since establishment in January 2002: the Emerging Africa Infrastructure Fund (EAIF) and Guarantco.
EAIF provides long-term debt and mezzanine for the construction and development of projects in sub-Saharan Africa, while Guarantco provides guarantees for local currency financings for projects in the developing world. Investors in the funds include European governments and commercial and development banks.
Harith manages Africa’s only 15-year infrastructure fund, the $630 million Pan African Infrastructure Development Fund (PAIDF). The fund invests in the energy, transport, information, communication and telecommunications sectors.
In a statement, Harith said the management team of FMFML will remain in place and that it would retain its name and continue as a stand-alone business “supported by Harith and its infrastructure”.
Harith chief executive Tshepo Mahloele said the acquisition was part of the firm’s growth strategy as it aimed to become a “multi-fund manager”. The firm’s combination of debt and equity would allow clients a “one-stop service” for the financing of infrastructure projects.
Mahloele predicted that the enhanced platform would “become a vehicle of choice for international capital and African capital looking for exposure in the continent”.