The private equity market in Africa continues to grow at a considerable pace. Under-developed financial markets, political instability and other barriers to entry are breaking down and investors from across the world are becoming increasingly eager to pursue on opportunities in the region.
Preqin Investor Network currently tracks 1,270 private equity funds on the road seeking an aggregate $532bn in capital commitments, with an average target size of $471mn. Africa-focused vehicles represent 5.4% of the private equity fundraising universe and are presently looking to raise $19bn with an average target size of $302mn. In terms of funds types, 30% of vehicles are looking for venture stage investment opportunities in Africa, followed by 28% of growth funds and 15% of funds of funds.
One of the prominent pan-African private equity funds in market is the $500mn African Development Partners II, which is looking to invests in financial institutions, pharmaceuticals and hospitals, telecommunications, food service and agribusinesses, consumer goods, education, engineering and construction in the region. Another Africa-focused vehicle, the €150mn Venture Partners Botswana II is set to invest in resources, consumer goods, retail, communications, financial services and construction materials mainly in Southern Africa.