Private equity firm ECP upbeat on Africa growth including TV
Africa offers plenty of scope for private equity investments, with at least another decade of strong growth expected from consumer goods, broadband internet and financial services, the co-head of one of the continent's top private equity groups said.
Africa has already produced years of explosive growth in cell phones and banking, but new sectors such as TV over internet, insurance and real estate are set to form part of the next wave, according to Washington-based Emerging Capital Partners (ECP).
The group, which has raised more than $1.8 billion for African investments over the past 10 years, has made more than 50 investments and 20 successful exits on a continent still shunned by many private equity firms.
"I can assure you there's no bubble in Africa at the moment. Every guy in the elevator's not pitching a deal here yet," co-Chief Executive Hurley Doddy told Reuters in an interview at the group's offices in Nigeria's commercial capital Lagos.
"A fast-growing African economy can suck up a lot of capital unlike Asia or China. There are maybe too many private equity dollars chasing a deal there, which is just not the case here."
One such example is Kenya's Wananchi, a triple-play telecoms firm which bundles broadband internet, cable television and voice telephony into one package and is rolling out its services to nine east African countries.
"A country like Kenya may be over 50 percent in terms of cell phone penetration but Pay TV, broadband are still at the one and two percent type range, so once again we probably have another decade of growth in that type of business," Doddy said.