DIANNA GAMES: Reality check needed as investors hunt for African assets
Billions of dollars earmarked for African assets often fail to find a home, writes Dianna Games
Among the many challenges Africa faces is hype. Global advisers, consultants, investment bankers, asset managers and others with a vested interest in getting international capital to Africa, one way or another, sold us the "Africa rising" story. The strategy succeeded. Billions of dollars flowed in, Africa-specific investment funds mushroomed and international private equity giants rushed to secure lucrative assets on the continent. Valuations of blue-chip local companies jumped as funds competed for their attention. But the hype did not always live up to the reality. The pan-African assets fund managers sought were in short supply and local companies were not always eager to sell chunks of their companies. Local stock exchanges, despite high returns for a while, turned out to be mostly shallow and illiquid, making exits difficult. Some of the much-touted fastest-growing economies in the world turned out to have feet of clay, as the commodities downturn so harshly proved. The billio...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.