Stimulus grows portfolio
Leading private equity firm, Stimulus Investments says it is poised to continue delivering superior returns to investors.
For the twelve months ended October 2012, Stimulus managed to achieve a portfolio return of 17.92%, and Managing Director, Monica Kalondo is bullish that the firm will continue delivering strong returns in the future.
Kalondo believes that private equity is a viable asset class for investors as, which if well managed, has the ability to produce superior returns. “In addition to stemming capital outflow, it also provides local entrepreneurs and businesses with alternative sources of capital,” she says.
Kalondo told the Economist recently that the firm’s goal is to continue adding value to the companies they are invested in and deliver superior returns to investors over the long-term.
She attributed the firm’s success in achieving upper quartile returns to “a combination of well-performing portfolio companies led by strong management teams, a robust economy and many other factors some of which are within our control and some outside of our control.”
But despite the healthy performance of funds invested under Stimulus, Kalondo bemoaned the lack of private equity skills in the country. She said Namibia has an acute skills shortage and the availability of private equity skill is not exempt from this reality. She, however, noted that “a positive development is that there are more players in the market which lends itself to more Namibians acquiring private equity skill.”
In November last year, Stimulus successfully raised additional investment capital of N$131 million through a Rights Offer to existing institutional investors that include Namibian pension and provident funds as well as life insurance companies.
Stimulus says it intends to utilise the capital raised from the offer to further build and diversify its investment portfolio by acquiring interests in quality Namibian businesses. The MD however, declined to comment on the assets that the equity firm was targeting citing confidentiality.
Stimulus is a shareholder in a number of unlisted businesses across the economic spectrum. The company is invested in Plastic Packaging, Cymot, Democratic Media Holdings, Nashua Namibia, Walvis Bay Stevedoring and the Joe’s Beerhouse property.