PEI: Duet: ‘Cautious’ LPs eye deal-by-deal investing in Africa

As one of MENA’s largest players, Abraaj Group’s unravelling has done little to instil confidence among investors looking at African private equity funds. No vehicles targeting sub-Saharan Africa held final closes in the first half of this year and they closed on just $330 million last year, according to PEI data.

Fundraising for MENA -focused private equity vehicles also fell to around $711million in 2017, down 64 percent from the roughly $2 billion raised the previous year.

A growing number of investors are now looking to dip their toe in on a deal¬by-deal basis, rather than committing wholesale via a blind-pool fund.

Duet Private Equity, which invests deal-by-deal in sub-Saharan Africa and eastern Europe, is among those that could benefit from this shift in sentiment. The firm, which has as many as 25 investors with whom it regularly invests, has seen the number of enquiries for such opportunities increase over the past year, chief executive Henry Gabay told Private Equity International.

“[We’ve seen] probably twice the appetite, and in addition to that we have unsolicited calls or meeting requests,” he said. Its existing investor base includes two development finance institutions, a multi-billion-dollar family office and a Middle Eastern investor.

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