The business of basketball in Africa, Africa’s first social bond.

Another weekly round-up of news, trends, and insights for the Africa-focused business executive, finance professional, and policymaker. Subscribe to be notified of each edition.

This week:

1) The business of basketball in Africa.

The hugely popular National Basketball Association, a professional basketball league in North America has formed a new entity called NBA Africa to conduct its business and accelerate its growth in Africa. The strategic investors include a consortium led by Babatunde “Tunde” Folawiyo Chairman and CEO of Yinka Folawiyo Group, Helios Fairfax Partners Corporation (HFP), led by Tope Lawani, NBA Global Ambassador Dikembe Mutombo (the Democratic Republic of the Congo), and other NBA legends. The NBA Commissioner Adam Silver said the current enterprise value of NBA Africa is "nearly $1 billion,".

Why is this important: Africa presents a significant commercial opportunity for the NBA franchise from TV rights to merchandising considering the popularity of sports with Africans of different demographics. The wealth of local knowledge and investment understanding of the continent by the strategic investors will make a difference in ensuring its success.

2) Africa’s first social bond.

According to reports from Bloomberg, Ghana is planning to raise $1 billion through the sale of sustainable bonds by July 2021. The bond will be used to fund a key policy to increase access to education and will be Africa's first social bond.

Why is this important: This is a good sign for Africa economies with the recent issue of Africa’s first green bond to now its first social bond. The issuing bonds specifically in line with environmental, social, and governmental (ESG) standards, which ensures transparency increases the spectrum of local and foreign impact investors who can invest in these bonds as the appetite for ethical investing continues to grow.


Private Equity Deals  :

  • South Africa-based Vumela Fund established by FNB Business and Edge Growth, has announced a new partnership with Rand Pharmaceutical Distributors that will see the expansion and growth of this innovative 100% Black-owned-and-managed company that services independent pharmacies, small clinics, and private practices.

Private Debt

  • Africa's largest mezzanine fund manager Vantage Capital has provided $23 million of debt funding to Egypt’s leading hotel owner and operator Pick Albatros which will be used to fund renovation work and working capital for the recently acquired hotels.

  • International Finance Corporation (IFC), the private-sector investment arm of the World Bank, has committed $30 million to African agricultural commodities company ETG.

  • The Agri-Business Capital (‘ABC Fund’) has provided €1 million loans to three agri- businesses to support their working capital needs and expansion. Burkina Faso based Kaworo, a producer of grains; maize, millet, sesame, cowpeas, and sorghum received €450,000, Yaffa et Frères (EYF), one of the largest local fresh mangos exporters in Mali received €250,000, and Côte d’Ivoire based ROCFED, an exporter of mangos has received €300,000.

Venture Capital Deals:

  • South African-based Tiger Brands will launch an R100 venture capital fund in June 2021 to fund food and beverage startups that require capital and capability to grow their businesses.

  • Egyptian-based agri-fintech platform Mozare3 serving more than 20 million underserved and unbankable smallholder farmers with innovative financial products has closed a $1 million pre-seed funding from Algebra Ventures and Disruptech Ventures, with participation from EFG-EV, and a group of reputable angel investors.

  • Nigeria-based health tech startup, CribMD has raised a $2.6 million seed round led by a Sputnik ATX US-based venture capital firm, Swedish accelerator, Norrsken, and mass media company, The Guardian Nigeria.

M & A Activities:

  • South Africa-based Credit provider Transaction Capital has agreed to increase its equity holding in WeBuyCars from 49.9% to 74.9%. The family trust of founding shareholders Faan and Dirk van der Walt will retain the remaining 25.1%.

  • South Africa’s Vodacom Group has received offers from interested parties looking to buy into its mobile money platform M-Pesa at a major premium, though not given full consideration as they expect the value of the financial services platform will not be reflected in the firm’s share price.

  • South Africa -based Visual International Holdings Ltd a leading property development company has signed a term sheet to acquire Agilitee SA from Agilitee Proprietary Ltd (Agilitee Africa), one of the first electric vehicle makers in the continent.

  • Djibouti-based Salaam African Bank (SAB), the country’s largest lender by branch network has acquired 100% of Kenya’s Uwezo Microfinance Bank (Uwezo MFB) at an undisclosed fee.

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FundraisingEvents:

  • Adiwale Fund, I managed by Adiwale Partners has received an investment of up to €9 million in equity from International Finance Corporation (IFC), the private-sector investment arm of the World Bank. The investment will enable it to make investments of between €3-8 million in growth-oriented SMEs in Francophone West Africa.

Liquidity:

  • Nigeria’s largest corporate bond issue BUA Cement Plc N115bn Series 1 Fixed Rate Senior Unsecured Bond under its N200bn Bond Issuance Programme has been admitted on the FMDQ Securities Exchange.

Economic Updates

  • The Central Bank of Nigeria has left its monetary policy rate unchanged at 11.5% during its May 2021 meeting.

  • South Africa’s private sector credit missed the market’s expectation of 0.9% and fell by 1.76 % year-on-year in April 2021.

The Week Ahead:

  • 31st May - Ghana’s Nigeria’s interest rate decision.

  • 1st June - Nigeria’s first-quarter trade balance.

  • 2nd June - Mauritius’s interest rate decision

Thanks for reading the Africa Finance Review. Have an excellent week ahead. Please send us any feedback, news, or suggestions to info@africafinancereview.com. Please ask your friends and colleagues to subscribe.