Private Equity Firm, Carlyle, Opens Offices in Nigeria and South Africa

People, the best place to be, right now, is to be in Africa or be doing something in Africa. We have complained about the lack of funds. That is going to change, because private equity firms are increasingly moving to Africa. South Africa and Nigeria are taking a big chunk of these new arrivals. Some of the best investment companies in the world are finding home in the continent. This was contained in a paper authored by Imara.

Nothing seems to be stopping the lion. It is moving ahead and the likes of Carlyle Group has joined the show. Now is the time for that great idea, because the continent is on the move.

While the International Monetary Fund (IMF) has warned that rising fuel and food prices are the main economic threats in Sub-Saharan Africa and that monetary tightening has failed to keep pace, economic growth in the region has firmly returned to pre-financial crisis levels. The IMF has reiterated its forecast of 5.5% GDP growth for the region this year and 5.9% in 2012, with low-income countries that make up the bulk of the continent expected to recover the fastest. Ethiopia, for example is forecast to grow 8.5% this year.

Our own surveys have also revealed that private equity firms are creating teams and raising new funds to target investment in Africa. Carlyle Group, for example recently opened offices in South Africa and Nigeria and believes that the continent is one of the fastest-growing regions in the world. According to various sources, the Washington-based buyout firm raised $500 million for its first Middle East and North Africa fund in 2009, and is now looking to raise another $500 million for its first fund targeting Sub-Saharan Africa. Vital Capital Investments LP, which invests in housing and agriculture in Africa is also reported to have raised more than USD 250.0m for its first fund and plans to get another $250 million in the near future.