Carlyle signs off from another Africa portfolio firm via secondary PE deal
Global private equity firm Carlyle, whose Africa team spun out to form Alterra Capital Partners two years ago, has struck another exit from its legacy Africa portfolio.
The development comes as Alterra continues to manage Carlyle’s investments in the continent and has been courting some offshore investors to come onboard as Limited Partners.
Carlyle has now agreed to divest its majority stake in Amrod, a supplier of branded promotional products in South Africa, to Oppenheimer Partners, a global investment holding company with a focus on Africa and emerging markets. The financial details of the transaction were not disclosed.
Founded in 2000, Amrod has grown organically to become the largest trade-only branded promotional products supplier in sub-Saharan Africa. Its wraparound business services include a B2B e-commerce platform, sales and marketing, and logistics. The business employs over 1,400 staff and supplies its products across the continent through a network of over 7,000 active distributors.
Amrod’s distributors, most of whom are small and medium-sized enterprises, span 14 African countries and are serviced through its five South African branches and offices in Botswana, Namibia, Zambia, Kenya and Nigeria.
Carlyle invested in Amrod in 2016 through its Carlyle Sub-Saharan Africa Fund (CSSAF). In 2020, the CSSAF team formed a separate private equity firm, Alterra Capital, which continues to manage CSSAF’s investments including Amrod.
This is the second exit move from the $700-million CSSAF, after it moved out from J&J Group in a $300-million logistics deal.
During the ownership period, the Alterra team worked closely with Amrod’s management to improve its operational performance, execute an M&A strategy, support its response to the Covid-19 pandemic, and expand into new markets including Kenya and Nigeria.
Jacob Hinson, Founding Partner at Oppenheimer Partners, said: “Amrod is a unique and differentiated business with a strong presence across Africa and values that resonate with Oppenheimer Partners. We were impressed by the management team and growth trajectory of the business, and we look forward to working with Amrod to build on its significant success to date.”
Oppenheimer Partners invests across the industrial, FMCG and services sectors and owns businesses in East, West and Southern Africa. It has invested over $700 million since inception in 2016 and intends to continue to deploy significant capital across Africa and emerging markets.
Rand Merchant Bank (a division of FirstRand Bank Limited) served as financial adviser to Alterra and Amrod. White & Case acted as legal adviser for Alterra and Amrod and Bowman Gilfillan acted as legal adviser for Oppenheimer Partners.
Alterra’s team, operating out of offices in Johannesburg and Nairobi, have led over $1 billion of private equity investments into 23 companies across Africa. Alterra’s core focus sectors include business services, healthcare, technology and telecommunications.