World leading asset management firm, The Carlyle Group, South African private equity fund, Pembani Remgro, and Standard Chartered have announced plans to make a strategic minority investment worth $210 million in Tanzania-based Export Trading Group (ETG).
The investment by Carlyle and Pembani Remgro in the African agricultural commodity marketer, is the funds first in sub-Saharan Africa.
Speaking on the debut investment, Herc van Wyk, CEO of Pembani Remgro Infrastructure Managers, was confident. He said: “ETG offers a unique combination of strong management and access to both the agriculture supply chain in Africa as well as key markets in China and India.” He added that his company was looking forward to “supporting the expansion of the company’s (ETG) supply chain footprint.”
Marlon Chigwende, MD and Co-Head of the Carlyle Sub-Saharan Africa Fund, said the investment is a “remarkable opportunity to invest in a business with a proven model that is highly scalable, has delivered impressive financial performance and has tremendous development impact on Africa and its economies.”
Previous deals
The Export Trade Group is a leading player in Africa across the agricultural value chain and has been securing investment for growth and expansion.
In June 2010, Standard Chartered, the first private equity investor in ETG, signed a $120 million collateral-backed import and export finance facility for ETG which the International Finance Corporation and the OPEC Fund for International Development offered a 50 percent unfunded risk participation to finance the trade of commodities in Kenya, Tanzania, Zambia, Malawi, Uganda and India.
At the beginning of the year, Standard Chartered’s Africa Private Equity also invested $74 million in ETG and would only be increasing its stake through the latest investment with Carlyle.
Founded in 1967, ETG connects African smallholder farmers to consumers around the world by procuring, processing and distributing agricultural commodities including maize, pulses, wheat, rice, cashew nuts, soya, fertilizer, sugar, coffee and tea. ETG has more than 7,000 employees across 30 African countries and operates 26 processing plants and 600 warehouses.
The Carlyle Group is a global alternative asset manager with $156 billion of assets under management in 99 funds and 63 fund of fund vehicles as of June 30, 2012. Carlyle invests across four segments – Corporate Private Equity, Real Assets, Global Market Strategies and Fund of Funds Solutions – in Africa, Asia, Australia, Europe, the Middle East, North America and South America. The group employs more than 1,300 people in 32 offices across six continents.
The Pembani Remgro Infrastructure Fund was recently established as a partnership between Phuthuma Nhleko and Remgro Limited. Phuthuma Nhleko is the former Group CEO of the MTN Group and is currently chairman of the Pembani Group, which has interests in the cement, mining and petroleum industries.
