Citadel Capital's Co-Founder and Managing Directors play a leading role at the 8th Annual African Venture Capital Conference in Cairo under slogan Africa: The Growth Continent for Private Equity ' 'Investment Opportunities 2010 and Beyond'
“The primary impediments to growth in Africa are a lack of capital for investment and underdeveloped managerial capacities, which are two things private equity is uniquely well-positioned to address,” said Hisham El-Khazindar, Co-Founder and Managing Director of Citadel Capital, the leading private equity firm in Africa and the Middle East controlling investments of more than US$ 8.3 billion in 14 industries spanning 12 countries.
El-Khazindar’s remarks came as part of the welcome keynote at the African Venture Capital Association’s (AVCA) annual meeting held in Cairo from 15-17 November under the auspices of Egypt’s Ministry of Investment.
“As the largest private equity investor in Africa today, we believe the investments we’re making in capital-intensive sectors including transport and logistics, cement, financial services and large-scale agriculture are clear testaments to our belief in our continent’s potential to generate strong returns for our co-investors – all while making a positive contribution to local development,” El-Khazindar continued.
Africa, with a population of close to one billion people, is more than three times the size of the United States, but accounts for only 2% of global GDP. According to the latest consensus forecasts, however, the continent will help lead global growth by posting an average GDP growth rate of approximately 4.2% in 2010.
El-Khazindar was joined at the conference by Citadel Capital Managing Directors Alaa El-Afifi and Stephen Murphy. Also participating was Peter Schuurs, Chief Executive Officer of Citadel Capital Portfolio Company SEAC (the Sudanese Egyptian Agricultural Company).
Citadel Capital is the largest private equity firm in Africa by PE assets under management (2004-2009, as ranked by Private Equity International), has been named emeaFinance‘s best private equity house in Africa in each of the last two years, and recently took home African Banker‘s award for Private Equity Firm of the Year.
The AVCA gathering, which was co-hosted by FMO (the Netherlands’ Finance Company for Development) and Citadel Capital, brought together private equity players from around the world to discuss opportunities and challenges in sectors such as infrastructure, agribusiness, energy and microfinance.
“While it may be obvious to those of us who are based in Africa, it is important to stress for foreign investors that many markets in Africa are particularly well suited to private equity investment, having as they do the fundamental prerequisites for development, including benign government, solid regulatory frameworks, and compelling natural advantages,” said Alaa El-Afifi, Managing Director of Citadel Capital.
El-Afifi chaired a panel on changing traditional private equity models to better suit the nature of investments in African markets under the current economic conditions.
Challenges such as accessing capital were also addressed in a panel that included Stephen Murphy, Citadel Capital’s Managing Director for Institutional Fundraising.
“Citadel Capital invests along two themes. The first is to target companies and industries that benefit from the continent’s natural advantages, which include cheap energy, large workforces and geographic advantages. The second theme is really related to the opening up in our region of large areas of economic activity to private sector participation,” Murphy added. “We harness these activities with our considerable appetite for corporate control, our insistence on investing 10-20% of the equity component of each of our transactions, and our emphasis on raising Opportunity-Specific Funds.”
Agriculture is a sector of particular interest to Citadel Capital. With more than 500,000 feddans [one feddan is approximately one acre] now available for cultivation in north and south Sudan, Citadel Capital’s Platform Company Wafra will supply fresh produce to local and regional consumers and could eventually become a major player in the food processing sector with products including various grains, halawa, sunflower oil, sugar and sugar derivatives.
“With the proper management, the development of transportation infrastructure and the strategic investment of capital, agriculture has a very bright future in the region,” said Peter Schuurs, CEO of SEAC, Citadel Capital’s Portfolio Company for agricultural investments in South Sudan.
Citadel Capital is a leading investor in Sudan, with platform and portfolio companies operating in sectors including logistics and river transportation, cement, mining, petroleum and financial services. By the end of 2010, Citadel Capital will have investments of more than US$ 900 million in Sudan; the firm is also active in Algeria, Sudan, Ethiopia, Libya, Kenya and Uganda, among other nations.
“We believe that our strategy of establishing a strong base in Egypt - the largest and most diversified economy in North Africa – and leveraging this base to ease our entry into other parts of the continent is part of the reason we are successful private investors across North and Eastern Africa,” concluded El-Khazindar.
Citadel Capital is the leading private equity firm in the Middle East and Africa, focusing on building regional platform investments through acquisitions, turnarounds, and greenfields executed via Opportunity Specific Funds. Citadel Capital’s 17 OSFs now control Platform Companies with investments worth more than US$ 8.3 billion across 12 countries and in 14 industries, including mining, cement, transportation, food and energy. Since 2004, the firm has returned more than US$ 2.4 billion in cash to investors, more than any other private equity firm in the region. Citadel Capital is the largest private equity firm in Africa by PE assets under management (2004-2009, as ranked by Private Equity International). For more information, visit www.citadelcapital.com.
For more information, please contact:
Ms. Ghada Hammouda
Head of Corporate Communications,
Citadel Capital (S.A.E.)
g...@qalaaholdings.com (click to reveal this email)
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