Largest pan-Africa fund closes

Emerging Capital Partners, the Washington DC-based offshoot of AIG Africa Infrastructure, has rounded up $523 million for a new fund targeting the continent. Already the firm is prepping a 3x exit from the new fund.

Washington DC-based Africa specialist Emerging Capital Partners (ECP) has held the final close of its new fund with $523 million (€391 million) in capital commitments.

Although there are larger South Africa-specific private equity funds, ECP now controls the largest vehicle for pan-African investment.

Limited partners to the vehicle come from Africa, the Middle East, Europe and the US, according to Thomas Gibian, chief executive of ECP.

The fund is a step up from the group’s predecessor vehicle, AIG Africa Infrastructure Fund, which raised $400 million in 2000. While managing that fund, Gibian and his team worked at emerging markets private equity firm EMP Global. ECP is now an independent firm, although its new fund is called EMP Africa Fund II.

The firm will focus on telecom, financial services, natural resources and agribusiness investments across Africa, although the large markets of Nigeria, South Africa and Egypt will be a particular focus.

ECP has already made several investments through the fund including Anvil Mining in the Democratic Republic of Congo, Pan-African Bank of Africa and East African engineering company Spencon International. Already ECP is preparing to exit from one of these investments, a realisation that is expected to generate a three-times return for the firm.

Gibian said Africa has companies that are appropriate private equity destinations and his firm holds these companies to the same governance and transparency standards as it would in any other market.

“These companies can provide above-market returns that are historically uncorrelated to the US and other global economies,” he added.

In the last seven years, ECP has made more than 35 investments in 30 African countries. The majority of strategic and financial investors from the AIG African Infrastructure Fund committed to the current fund while first-time clients provided around half of the total. The firm has now raised over $1 billion. 

The firm has 25 investment professionals, 10 of which are in Washington DC, and the rest in offices in Jonannesburg; Bonanjo Douala, Cameroon; Ivory Coast, and Tunis.

Given the pace of the firm’s investments, ECP may begin fundraising on a new vehicle as early as next year.