05 April 2017
Atta Financial Update
Executive summary:East Africa attracting interest
The contemplated sale of east Africa’s largest chain of coffee shops is being regarded as a key indicator of the interest of international private equity groups’ interest in the region. TPG and Carlyle, two of the world’s largest private equity groups, have in the past few months expressed an interest in purchasing Java House, with the deal expected to value the coffee chain at as much as US$100m.
Java has more than 50 outlets in Kenya, Uganda and Rwanda, as well as pizza restaurants and frozen yogurt shops. It is currently controlled by Emerging Capital Partners, a private equity group that has a 90 per cent stake.
South Africa has traditionally been the leader in large private equity transactions on the continent however east Africa has been growing quickly over the last couple of years; quicker than west Africa.
The most attractive sectors for private equity groups tend to be consumer industries, real estate, financial services and energy as well as infrastructure, where private funding can combined with finance from development institutions such as the UK’s CDC group. The expectation is that the region’s momentum will continue, although a degree of uncertainty will remain until the Trump administration’s policies towards Africa, on both trade and aid, become clear.
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