Venture Partners looks for second fund

Wanetsha Mosinyi
Correspondent | Friday November 23, 2007 00:00

VPB Marketing Associate Diphuka Maganu told Business Week that the new fund aims to achieve its first close in June 2008 on 60 million euros, and they anticipate that 60 percent of the capital will be from Botswana.

Maganu said the private equity firm intends to invest across the region in countries such as Zambia, Namibia and Angola.

'Because of the Southern African Development Community, whose aim is to harmonise economic development in southern African countries, industries in the region will consolidate over time, which will lead to cross-border tariffs being lowered and legislation becoming more uniform across the region.' The funds from CVCF have been invested in a wide range of industries. In some cases, they have actually facilitated the start-up of certain sectors, as in the case of tanning firm  Tannery Industries Botswana and  dairy concern Delta Dairies. The CEDA Venture Capital Fund (CVCF) was capitalised at P200 million when it was launched in 2003. The fund was set to run for a period of ten years, but in less than half that time, all the funds have been committed to investments.

Some of the companies that benefited from the fund are the upcoming Latex condom manufacturing company, Biz Capital, Mabele Breweries and Airway Express.

Maganu said the overriding objective of VPB is to create employment, facilitate citizen economic empowerment, and help in increasing the economic activity base through  investments in non-traditional sectors, as well as to make a commercial return for CEDA.

She said to date the fund managers have more than lived up to this commitment and have also proven the potential for private equity as a promising industry in the country and the region. VPB, together with the Botswana International Financial Services Centre (IFSC), will host the Africa Venture Capital Association (AVCA) Annual Conference in Gaborone next year. The conference is expected to attract between 400 and 500 delegates.

It is also expected to put the Botswana venture capital industry firmly under the spotlight. 'This will serve as a catalyst for the growth and development of this important asset class in the country and the region as a whole,' she said.