Private equity investor Actis has sold 9 percent of its 13 percent stake in South Africa-based Alexander Forbes Group Holdings Limited (Alexander Forbes) in an oversubscribed offer through the Johannesburg Stock Exchange (JSE).
The sell will see Actis substantially exit Alexander Forbes whose 2007 $1.2 billion buyout it led, in one of the largest and most complex leveraged buyouts ever undertaken in Africa.
However, Actis will fully exit Alexander Forbes when Mercer Africa Limited completes its acquisition of 34 percent of the pension manager. Mercer is initially acquiring a 14.9 percent stake, at the time of the Alexander Forbes listing, and subject to regulatory approvals, will acquire a further 19.1 percent stake; leading to a full exit for Actis and other private equity consortium members who collectively hold 54 percent of the group pre-listing.
Mercer Africa Limited, a wholly owned subsidiary of Marsh & McLennan Companies with major interests in talent, health, retirement, and investments, sees the acquisition as an opportunity to broaden its exposure in sub-Saharan African markets. Alexander Forbes Group had, earlier this month, set the offer price for its share listing at up to 8.05 rand a share, valuing the company at as much as $962 million.
Julio Portalatin, President and Chief Executive Officer of Mercer said of the deal with Alexander Forbes “We are thrilled to have this opportunity to establish a relationship with Alexander Forbes, a leader in the retirement, investments, and employee benefits space in South Africa and broader Sub-Saharan Africa… [eap_ad_2] “This is the beginning of a strong partnership that will generate value for both of our firms and our respective clients. We are particularly excited to significantly broaden our exposure to the growth prospects present in South Africa and sub-Saharan Africa. Through this investment, we will be able to support our global clients seeking to enter and expand into the African market, and with our global reach and capabilities, we will be able to support Alexander Forbes’ clients seeking to grow outside of Africa.
Since the buyout of Alexander Forbes, Actis -which invests exclusively in the emerging markets- and fellow shareholders have transformed the business from a corporate governance perspective. With a new high calibre senior management team, the board helped to recover reputational issues that plagued the business, attract industry experts to the Board, develop a retail offering and expand EBITDA margins through disposing of non-core business units and driving cost efficiencies.
Speaking about the landmark investment, Natalie Kolbe, a Partner at Actis said: “It is fantastic to see Alexander Forbes embark on the next stage of its development. We are extremely proud of our work transforming the business. Alongside the management team and other shareholders, we have achieved a tremendous shift in the business, one that epitomises our investment philosophy of our capital being more than solely financial. The strong interest we have received, in one of the largest listings in sub-Saharan Africa ever, signals significant appetite from both African and international institutional investors.” (Ventures Africa)[eap_ad_3]
