African PE firm Ascent Capital exits Ethiopian diagnostics firm

 African PE firm Ascent Capital exits Ethiopian diagnostics firm

East African private equity firm Ascent Capital, which recently made the final close of its second fund and has struck two control deals in the healthcare domain for Valley Hospital and Diani Beach Hospital, has sealed an exit.

The PE firm’s first investment vehicle, Ascent Rift Valley Fund (ARVF), has sold its stake in Ethiopian medical diagnostic laboratory company Medpharm Holdings Africa, which operates as International Clinical Laboratories (ICL), to Cerba Lancet Africa.

Terms of the transaction were not disclosed.

Cerba Lancet Africa, majority owned by the French group Cerba HealthCare, set foot on the African continent in 2019. It now operates in 15 countries, providing access to diagnosis to more than 3 million people yearly.

ICL Ethiopia chief Tamrat Bekele, said the transaction will allow the firm to tap into the huge resources and expertise of Cerba HealthCare, specifically in the fields of oncology, genetics, companion diagnostics, preventive medicine, patient and physician education and research to tackle unique and challenging issues.

“This new foundation will allow us to expand our test menu and offer unique services and tests that will contribute to the growth of the country’s health care system,” said Bekele.

Ascent Capital had made the final close of its first fund at $78 million around five years ago. This fund invested $2.5 million in ICL in February 2016.

ICL’s revenue has grown nine-fold with test volumes growing from 15,000 per month to 40,000 per month during the investment period.

Other deals by the fund include Kisumu Concrete Products in Kenya; Chims Africa, a mobile money network in Uganda; Africa Queen Uganda Holdings; Allcent Global Corporation (Ethiopia); Pharmcent (Uganda); Unicent (Ethiopia); Auto Springs Mauritius and Metroplast Mu.

The PE firm recently made the final close of its second fund, Ascent Rift Valley Fund II (ARVF II), with commitments of about $128 million, just short of its $130 million hard cap for the fund. Investors in ARVF II include Belgian Investment Company for Developing Countries (BIO), British International Investment, FMO, IFC, Norfund, Proparco, SDG Frontier Fund, impact investors and major Kenyan pension funds.

The UK’s BII, formerly CDC Group Plc, and Norway’s Norfund are among the returning investors in the second fund.

The new fund will look to take large minority or majority stakes particularly in the financial services, manufacturing, wholesale and retail trade and services, education, healthcare and agro-processing sectors. It will invest $4-15 million in each company, a step up from the minimum threshold of $2 million in its predecessor.

Ascent was advised by I&M Burbidge Capital and Clyde & Co. in this exit transaction.

Vivek Sinha

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