Old Mutual buys Macquarie stake in $1bn African manager

The South African insurer will become the sole owner of AIIM at a time when the firm nears full deployment of its latest fund.

Old Mutual Alternative Investments (OMAI), a subsidiary of Cape Town-based Old Mutual, has acquired the 50 percent it doesn’t already own in African Infrastructure Investment Managers (AIIM).

The firm bought the stake from Australia’s Macquarie Infrastructure & Real Assets, with whom it co-founded AIIM in 2000, in a drive to boost its asset management base and earn strong returns from what it deems one of infrastructure’s most lucrative markets.

“The global alternative investment industry is estimated to be worth around $13 trillion by 2020 and is predicted to be the fastest growing segment of the asset management industry globally over the next 10 years,” said Paul Boynton, chief executive of OMAI, in a statement.

AIIM is currently investing through African Infrastructure Investment Fund II (AIIF2), which reached a close on $500 million in 2011. A spokesperson for the firm said earlier this year the vehicle was getting close to being fully deployed.

Itself a joint venture, the firm has launched several pan-African platforms with specialist developers over the last couple of years. The most recent one saw it partner with Hydroneo Afrique, a wholly-owned subsidiary of France’s MECAMIDI, with a view to develop up to 200 megawatts (MW) of small and medium-sized hydro plants in Cameroon, Cote d’Ivoire, Gabon, Ghana and Mozambique.

The endeavour is budgeted at a total of $500 million.

In February, the firm also backed London-based Joule Africa in a bid to invest in projects developed by the company. These comprise the 202MW Bumbuna II hydro-electric project in Sierra Leone, pursued in partnership with Denham Capital’s Endeavor Energy, and the Kpep hydro-electric project in Cameroon, on which it is teaming up with the government and local builder Bethel Industrievertretung.

Investors in AIIF2 include the International Finance Corporation, the African Development Bank, FMOProparco and the Development Bank of Southern Africa.