Duet Private Equity and AMCON (Asset Management Corporation of Nigeria) are to establish an investment fund focused on Nigeria’s FMCG sector.
The fund will launch with an initial target size of USD400 million and AMCON will contribute six portfolio companies currently under its control. The fund will invest an additional USD200 million into these six companies.
The fund will focus on turnaround and distressed situations, where companies require additional capital and debt restructuring. The portfolio will consist exclusively of food and beverage companies with local brands.
Ahmed Kuru, AMCON chief executive, says: "We are very excited about partnering with Duet in this private-public partnership. AMCON was established by the Government of Nigeria in 2010 to support the country’s private sector, and our initiative will provide working capital for many companies which have suffered in the past from a scarcity of finance. It reflects the administration’s drive to attract fresh, direct foreign capital into businesses."
Henry Gabay, Duet Group CEO and Duet Private Equity chief investment officer, says: "We are delighted to partner with AMCON in this exciting project. We believe it is absolutely the right time to invest in Nigeria and in the FMCG sector. We have a strong track record partnering with promising, growth business that can tap into growing demand for consumer goods in Sub Saharan Africa. We believe that import substitution and local product development present huge opportunities for investors in the region. We plan to invest new capital into those companies as well as contribute additional management and industrial expertise. Where necessary, we will leverage our excellent relations with blue chip companies to bring in additional expertise to these companies by teaming up with experienced industrial partners."
Maty Ndiaye, Duet Africa Private Equity managing director, adds: "In the present difficult economic climate, our venture will be very important for Nigeria. At Duet, we believe in the longer-term economic potential of the region. We are delighted to be able to extend our investment capabilities across the region following our recent investments, including one of Ethiopia’s biggest breweries, as well as food and drink producers in Ghana and Ivory Coast".
Duet Private Equity will shortly open an office in Nigeria to help identify and assess investment opportunities, manage portfolio companies and work with local partners.