EA Private Equity association formed

 

 A construction site in Kigali. A Kenyan PE firm, Fusion Capital has teamed up with a real estate developer in Kigali to put up a commercial building. Photo/FILE  Nation Media Group

By Steve Mbogo Special Correspondent

Posted  Saturday, March 9  2013 at  18:28

In Summary

• The launch last week in Kenya, the bedrock of the region’s private equity activity was done by seven private equity companies, forming the first core membership of the new East Africa Venture Capital Association (EAVCA).
• The failure to have a regional body for the private equity industry had been cited earlier by the African Development Bank as one of the structural weaknesses limiting the growth of the industry in the region. inShare

After years of on and off planning, private equity and venture capital fund managers in East Africa have launched an association to consolidate the growth of the sector in the region.

The launch last week in Kenya, the bedrock of the region’s private equity activity was done by seven private equity companies (Centum, Fanisi Capital, Abraaj Capital, Actis, AfricInvest, Catalyst Principal Partners and TBL Mirror Fund), forming the first core membership of the new East Africa Venture Capital Association (EAVCA).

The failure to have a regional body for the private equity industry had been cited earlier by the African Development Bank as one of the structural weaknesses limiting the growth of the industry in the region.

The chairman of the new association, Ayisi Makatiani, is the managing partner and the chief executive officer of Fanisi Capital and Nonnie Wanjihia is the association’s executive director.

The launch of the association is a key step in enabling East Africans to understand the private equity industry, enabling a growing pool of enterprises to find alternative sources of funds.

In addition, private equity caps the funding with management changes that bring in new talent, facilitate skills transfer and help to add value to the operations of the enterprise.

In a brief statement after the launch, the members noted that EAC is at the pole-position to influence growth of private equity industry in the rest of Sub-Saharan Africa. 

EAVCA plans to start recruitment across the region. It will also start active representation of the industry in the public through the media and enterprises especially those that form the pool of their potential targets. 

The body said it will also start policy advocacy to influence regulation that is favourable and nurture the growth of the industry.

On its agenda is lobbying governments in the EAC to allow their pension schemes to invest in private equity, a move that if implemented will see the industry reduce it reliance on foreign fund raising and also lead to better utilisation of pension funds in the region.

The association will also set up systems that will allow data sharing. This will include regional market data, industry data, investment data and co-ordinate joint industry and sector studies.