The newly established private equity fund, Botswana Opportunity Partnership (BOP) is seeking to buy the Lobatse-based pipe-manufacturing firm, Radical Investments, trading as Flo-Tek Pipes & Irrigation.
BOP is a partnership between the Botswana Public Officers Pensions Fund (BPOPF) and Capital Management Botswana (CMB), with the mandate to invest in businesses in Botswana.
Flo-Tek chief executive officer, Vijay Naik, confirmed that negotiations for BOP to acquire Flo-Tek are at an advanced stage, but declined to provide further details on the transaction.
Flo-Tek, which was established in Botswana in 1998, specialises in the manufacturing and distribution of high-density polyethylene pipe (HDPE), unplasticised polyvinyl chloride (PVC-U), modified PVC (PVC-M) and sewer pipes and roto-moulded products. The company also supplies pipes for the manufacturing of borehole casings and screens.
The company recently expressed intentions to list on the Botswana Stock Exchange (BSE).
It is understood that BOP will invest into local businesses providing mostly growth capital.
Recently, BOP bought a 40 percent stake in Bramer Life Insurance.
CMB director, Rhys Carr earlier told BusinessWeek that BOP will consider investing in Botswana companies that have the potential to develop new products, create jobs and are viable enough to create a blended rate of return of 20 percent across all the businesses.
The BOP aims to invest in businesses for a period of up to eight years, before exiting either through a listing on the BSE or selling back shares to the original vendors of the business. The target is to invest between P50 million and P150 million, into a single business and take up a minimum of 25 percent equity in a firm.