Capital Management Botswana (CMB) is targeting to raise up to P2 billion under a trend setting private equity fund to be invested in local and Botswana linked businesses.
CMB, which won a P500 million private equity tender from the Botswana Public Officer Pension Fund (BPOPF) last year, says it wants to raise a further P1.5 billion from other local pension funds and international investors.
The new fund, Botswana Opportunities Partnership (BOP) will invest into local businesses providing mostly growth capital.
CMB director, Rhys Carr said they were looking for viable investment opportunities with growth potential. “We are looking to invest at moderately large size business value at north of P200 million with growth and export opportunities and expansion potential. Our 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,” he said.
CMB was out of BIFM Capital two years ago, when its promoters Timothy Marsland and Carr parted ways with former partners, BIHL. According to Carr, the BOP will look to invest into Botswana companies that have potential to develop new products, create jobs and viable enough to create a blended rate of return of 20 percent across all the businesses. “We are on the verge of tying up our first deal and we hope to bring on board a few other investors in the current financial year,” he said.
The BOP targets to invest in businesses for a period of up to eight years before exiting either through a listing on the Botswana Stock Exchange (BSE) or selling back shares to the original vendors of the business. Investor friendly Botswana is increasingly seen as fertile ground for private equity firms, given rapid economic growth and rising consumer spending.