Full shareholding of Swanib Cables taken over by GIPF-funded private equity fund
The drive by the Government Institutions Pension Fund to spread its investment risks through strategic private equity investments, took another step recently when one of the many new private equity funds announced it has taken over the full shareholding of Swanib Cables from its JSE-listed parent, Altron, for an undisclosed amount.
The deal is structured through an intermediate beneficiary unlike the Bank Windhoek deal which was a direct equity participation transaction.
The Namibian Mid-Cap Fund managed by Musa Capital Namibia said in a statement released on Wednesday that it has completed its acquisition of 100% of the shareholding in Swanib Cables from PowerTech Holdings which is part of the Altron Group.
The Namibian Mid-Cap Fund bought Swanib Cables with the intention to grow it into a regional diversified distribution platform by building on the company’s existing sphere of business. This will be expanded by further acquisitions that complement the target investment’s well-established customer base, product lines, and expertise.
The funds the Namibian Mid-Cap Fund employed for the transaction comes from the Government Institutions Pension Fund. “The acquisition is aligned with the Namibian Government and the Government Institutions Pensions Fund’s policy goals of infrastructure investment to drive economic growth, job creation, as well as meaningful economic transformation and participation” the fund stated.
Labelling it a “transformation” deal, the fund said the transaction is expected to provide broader benefits to the Namibian economy. These it lists as reverting shareholding in a local company from its former South African owners to “Namibian beneficiaries and incentivising empowerment partners to grow the value of the business.”
Local empowerment of previously disadvantaged Namibians through meaningfull equity participation is described as a strategic consideration with the ultimate aim to create jobs as the company grows under its new owners with new direction.
Swanib Cables is a well-established distributor of electric cables, transformers and fibre optic cables to the clients in mining, utilities, infrastructure and telecommunications. For more than 20 years, it has supplied the mines, the government and larger technical companies that use its products. It is the largest local distributor of the specialised electric and electro-mechanical equipment for which it is the agent through Altron. Swanib Cables was founded in 1985.
Musa Capital Namibia is a subsidiary of Musa Group, a diversified company offering financial advisory and fund management services for 22 years. The Mid-Cap Fund is its third African private equity fund.
Musa Capital said it targets existing businesses requiring expansion capital in the mid-cap segment.
The application to the Namibian Competition Commission for the acquisition of Swanib Cables was submitted on 17 June 2017 and approved late in July. “Swanib Investment Holdings (Pty) Ltd is a limited liability company incorporated in accordance with the company laws of Namibia, with its principal place of business at 30 Blohm Street, Windhoek Namibia. In terms of the filing the following entities also form part of the acquiring group: Musa Capital Namibia (Pty) Ltd, Muscat Investments CC, Swanib Investment Holdings (Pty) Ltd and Namibia Mid-Cap Fund. The acquiring group is involved in the business of fund management” according to the Competition Commission.
