Private equity seeks the sweet spot in Africa
The industry is ‘soul searching’ as funds consider how to operate in more difficult conditions, says Bain analyst
Private-equity firms in Africa need to ramp up value-creation efforts if they are to keep delivering attractive returns amid a challenging macro environment, says Bain & Company. The private-equity industry was engaged in "soul searching", as funds carefully considered how to operate in more difficult conditions, said Andrei Vorobyov, head of Bain & Company’s private equity practice in Africa. After a very strong year for deals in 2014, private-equity activity had been more subdued, hurt by the decline in commodity prices and renewed political uncertainty in countries such as SA and Nigeria, Vorobyov said. Funds were now identifying "sweet spots" and focusing on how they could exercise their value-add muscle, he said. Private-equity funds in Africa raised $2.3bn in 2016, according to Bain’s global private-equity report 2017.