Firm secures Sh11 billion to invest in EAC

NAIROBI, KENYA:Kenyan private equity house, Catalyst Principal Partners, has secured Sh10.6 billion ($125 million) to invest in the east African region over the next four years, it said.

The Catalyst Fund 1 will be invested in a range of consumer growth-related opportunities in the region, which has some of the fastest economic growth rates in the world, said Paul Kavuma, chief executive of Catalyst.

“Our approach is to address this emerging regional consumer, with our investment focused on mid-market dynamic companies that are the engine for economic growth,” he told a news conference.

Catalyst will put the fund into consumer goods, retail, technology, services, manufacturing and engineering, with investments of between $5 million and $20 million apiece, he said.

The Mauritius-registered private equity house bought a substantial stake in Tanzanian manufacturer Chemi Cotex in 2011. Chemi Cotex is known for its Whitedent toothpaste.

The new fund will target investments in Kenya, Uganda, Tanzania, Ethiopia, Rwanda and the Democratic Republic of Congo.

Kavuma, who left Actis East Africa to found Catalyst in 2009, said there was a pipeline of deals in those economies.

“We are in advanced talks with companies in the finance and technology space in Kenya that we are very interested in,” Kavuma said, adding more details would be unveiled later this year.

Investors in Catalyst Fund 1, which exceeded the initial target by a quarter, include the International Finance Corp, European Investment Bank, African Development Bank and the German Investment and Development Corp, he said.