The acquisition and share interest figures above do not reflect follow-on investments or partial realizations.
In June 2014, Helios announced that it acquired a minority stake in ARM Pension Managers PFA Limited (“ARM Pensions”), a subsidiary of ARM. ARM Pensions is Nigeria’s largest independent pension fund manager with over $2.2 billion of pension assets under management. It is well positioned to increase its market share, and Helios and the ARM Pensions management team have identified multiple value creation opportunities. ARM is one of Nigeria’s most innovative and respected nonābank financial institutions. Established in 1994, ARM has evolved into the largest, independent asset management company in Nigeria with total assets under management of more than $3 billion.
In December 2013, Helios completed an investment of $100 million in Bayport Management Limited (“BML”), acquiring a 23.4% interest in the company. The proceeds of the Helios investment will be used to fund growth as well as to part finance the acquisition by BML of Bayport Financial Services (“BFS”) from Transaction Capital, a publicly listed company in South Africa. Bayport is the leading African provider of unsecured credit and financial solutions, extending loans – typically four to five years in tenor – primarily to the under-banked in sub-Saharan Africa. The combined group will have a loan book of approximately $1 billion and be active in countries across the continent, including Botswana, Ghana, Mozambique, South Africa, Tanzania, Uganda and Zambia.
In July 2013, Helios finalized participation alongside BTG Pactual in a 50 / 50 joint venture with Petrobras International Braspetro B.V., a subsidiary of Petrobras, to explore and produce oil and gas in Africa. The joint venture will encompass Petrobras’ subsidiaries and portfolio of production and exploration assets in Angola, Benin, Gabon, Namibia, Nigeria and Tanzania. The transaction values the joint venture at US$3.05 billion.
In July 2013, Helios reached an agreement to provide growth capital to build an online retail business, Mall for Africa, backing an experienced, talented and entrepreneurial Nigeria-based management team. Mall for Africa is an innovative online shopping platform that provides access to top US and UK retail sites, initially focused on Nigeria. Helios will be a key strategic investor, helping to drive value through the team’s experience in starting, scaling and institutionalizing growing businesses, and through Helios’ operational capabilities.
In August 2012, Helios completed an investment of $62 million in Eland Oil & Gas, acquiring a 29.36% interest in the company. In addition to the initial investment, we also secured a two-year option on an additional $16 million at the same price. Upon exercise of the option, on a fully-diluted basis, Helios would hold a 34.24% interest. The proceeds of our investment (and additional capital raised simultaneously from third parties) were used to fund the acquisition from a Shell / Total / ENI joint venture of a 45% stake in an onshore Nigerian oilfield known as OML 40, with the balance held by the Nigerian National Petroleum Company. The company was listed on AIM immediately following the closing of the deal with Helios.
In February 2011, Helios, in partnership with Vitol Group (“Vitol”) reached an agreement to purchase for approximately $1 billion the downstream fuels business of Royal Dutch Shell PLC (“Shell”) in Africa, excluding South Africa. The businesses, which employ more than 2,500 people, comprise Retail, Commercial Fuels, Lubricants, Liquefied Petroleum Gas, Bitumen, Aviation and Marine divisions across 18 countries in Africa. Helios and Vitol each hold 40% interests in the resulting company, Vivo Energy, with Shell retaining a 20% stake. Vivo Energy continues to operate the Shell brand and adheres to Shell’s global health and safety standards.
In December 2010, an investor group led by Helios agreed the acquisition of a majority equity interest in Interswitch Limited (“Interswitch”), the largest payment processing service provider in Nigeria. Helios’ $96 million investment represents a 52% interest on a fully-diluted basis. Interswitch has been at the forefront of the development and growth of the e-payment sector. It also administers Verve, the leading debit card scheme in the country. The firm offers integrated message broker solutions for financial transactions, e-Commerce and e-billing solutions, telecoms value-added services and payment collections solutions.
In November 2009, Helios and a group of investors including Soros Strategic Partners LP, RIT Capital Partners plc and Lord Rothschild’s family interests, and Albright Capital Management LLC committed $350 million to Helios Towers Africa Limited (“HTA”). The Helios interest was initially 28.6%. HTA, a newly formed company, builds and maintains telecommunications towers and leases space on those towers to wireless telecommunications services providers across Africa. Since its formation, HTA has acquired, through sale and leaseback transactions, tower assets in Democratic Republic of Congo, Ghana and Tanzania.
In December 2009, an investor group led by Helios completed the $146.8 million acquisition of INM Outdoor, now called Continental Outdoor Media (“Continental Outdoor”), from Independent News & Media plc. The Helios interest totals 68.8%. With operations in South Africa and 13 additional countries in sub-Saharan Africa (Angola, Botswana, Lesotho, Malawi, Mauritius, Madagascar, Mozambique, Namibia, Swaziland, Tanzania, Uganda, Zambia and Zimbabwe), Continental Outdoor offers its customers unparalleled access to a network of over 42,000 advertising opportunities.
In December 2007, Helios completed the $178.7 million acquisition of a 24.99% interest in Equity Bank, which is listed on the Nairobi Stock Exchange. The bank’s strategy of providing services to the previously un-banked population has enabled it to build Kenya’s largest account-holder base, and industry-leading growth rates and profitability. Post Helios’ investment, Equity Bank has acquired Uganda Microfinance Limited and expanded organically into Rwanda, South Sudan and Tanzania.
In August 2007, Helios completed the $165 million purchase of a 22% interest in Africatel with an option to acquire an additional 3% which has since been exercised. Africatel was formed to aggregate the sub-Saharan Africa telecommunications assets – principally in Angola, Namibia, Cape Verde and São Tomé – of the Portugal Telecom Group.
In April 2007, Helios completed the $50 million acquisition of a 16% interest in FCMB, a rapidly growing universal bank in Nigeria which is listed on the Nigerian Stock Exchange. The bank is capitalizing on the low penetration of banking services in the country, and on strong underlying economic growth, to build a dominant position in retail banking while maintaining its traditional leadership in corporate banking. This investment was fully exited in December 2013.
In January 2005, the principals of Helios founded Helios Towers Nigeria to capitalize on the extremely strong growth in mobile telephony in Nigeria by deploying the successful tower leasing business model pioneered by US-based companies such as Crown Castle International and American Tower. Helios and affiliated entities invested $58.9 million in the company and hold 22.5% which, together with affiliated entities, gives Helios a majority interest on a fully-diluted basis.
The August 2004 Modern Africa transaction valued the Modern Africa fund's 8.5% interest in Flamingo Holdings at $12.3mm. Flamingo, based in Kenya, is active in the growing, processing, packaging, marketing and distribution of cut flowers and fresh vegetable. The company is the largest vertically integrated horticultural producer and exporter of flowers and vegetables from Africa to the European Union. Helios worked closely with management to maintain the company's growth and profitability in the face of significant strategic challenges, notably continued consolidation in the UK supermarket sector, the company's principal customer base, and the concurrent rapid increase in air freight costs as oil prices rose and air cargo capacity diminished. Despite these significant strategic challenges, in May, 2007, the company reached a merger agreement with Finlay's, a wholly owned subsidiary of John Swire and Sons, valuing the Modern Africa interest at $17.5 million, implying a 40% capital gain.
In August 2004, Helios took over joint management of the Modern Africa fund, a fully-invested but severely distressed Africa-focused private equity fund, in a transaction valuing the 55% interest in Afsat Communications at $2.7 million. Afsat, headquartered in Kenya, was formed to provide high-end satellite-based data network solutions for corporate and governmental organizations in east and central Africa. Helios has provided management with hands-on support for the company's expansion into the larger and more lucrative consumer market segment as well as its geographic expansion across the sub-Saharan region (including Nigeria, the region's single largest market). In June, 2007, the company reached a merger agreement with MWEB, South Africa's leading Internet service provider, valuing the Modern Africa interest at $24 million, implying a 3-year internal rate of return of approximately 115%.