While large-cap-buyouts may grab the headlines, it is often the lower profile mid-cap deals that offer the best returns. Admaius Capital Partners is trailblazing a path to becoming a champion in the space, a strategy that has attracted unique limited partners (LPs). Marlon Chigwende, managing partner, gives insight into its strategy. The firm has previously been recognised as the Fundraiser of the Year at the Private Equity Africa Awards.
What is the story behind Admaius Capital?
Admaius Capital Partners is a pan-African investment firm with six offices on the African continent. We believe that private equity is a local business. As such, our local teams are well positioned to source and execute good quality transactions across our focus areas. Primarily targeting mid-cap deals, our aim is to produce attractive risk-adjusted returns while being mindful and intentional about our impact goals.
At Admaius Capital, we believe businesses are pivotal in creating and delivering sustainable socioeconomic value within their communities and markets of operation. Through our investment strategy, we support leading entrepreneurs across our core African markets to deliver this wider socioeconomic value while also seeking competitive financial returns for our LPs and end beneficiaries.
We are leading by example with best-in-class environmental, social, and governance (ESG) standards and principles for responsible investment. Working closely with each of our portfolio businesses, we will ensure comprehensive ESG action planning with commitments to implementation, robust compliance reporting, and measurement.
How does having unique LPs in your fund boost your strategic advantage?
Our first fund, Virunga Africa Fund 1, consists of commercial investors who are looking for an attractive economic return and for us to create a lasting positive impact on the African continent. Our LP investors are some of the largest sovereign wealth funds as well as the most sophisticated African pension funds.
We believe this is an encouraging mix of long-term capital that is committed to the development of the African continent and the African asset management industry. Over and above this, our strategic advantage lies in the quality of our people and our on-the-ground approach.
Delivering positive impact and wider socioeconomic value is thus a key part of how we interpret our responsibilities and fiduciary duties. To achieve this, we use ESG and impact across investment decision-making and portfolio management processes.
What does your local African presence look like?
Admaius Capital has a main presence in Rwanda, with regional offices across Africa, in Kenya, South Africa, Egypt and Tunisia – plus an international office in the United Kingdom.
Our firm is led by a highly experienced team with over 110 years of combined experience, an extensive track record backing leading African businesses, and a demonstrated ability to exit and deliver returns.
The leadership team combines deep local knowledge and understanding with international experience. With more than 100 years of operational business experience and more than 90 years of private equity experience, we are on the ground with the ability to deploy in-country. This also enables us to offer in-company support to portfolio businesses, for them to achieve their growth ambitions.
What types of mid-cap deals are attractive to you?
To date, we have executed deals in financial services, education, fast-moving consumer goods (FMCG), and healthcare. Over the life of this fund, we would expect to do more deals in these sectors and also potentially in technology, media, and telecom (TMT), and logistics.
One of our most recent deals is Parkville Holding, an Egypt-based healthcare company focused on the cosmeceutical space. Parkville will use the new capital for geographical expansion, with the company looking to grow its footprint regionally across the Middle East and Africa (MEA) region. The company has grown into one of the largest and fastest-growing cosmeceutical companies in Egypt. About 80% of its customer base is made up of women.
We invest in Africa’s most innovative and transformative businesses of tomorrow, helping the continent diversify into sectors of technological innovation and enhanced human capital. We see opportunities for dynamic entrepreneurship through supporting successful, profitable companies that deliver lasting returns for investors and end beneficiaries.
As we invest, our team also strives to achieve lasting economic and social impact for the individuals with whom our companies intersect through reducing gender inequalities within workforces and supporting equality of opportunity while minimising our negative environmental and social externalities.
What advice would you give to LPs trying to step into Africa?
LPs looking to invest in Africa are concerned about risks and returns. Selecting the right manager with experienced people that understand local dynamics is crucial, as they will assist in managing these issues. Sector selection and portfolio execution are also important ingredients in successful investments.
One of our biggest lessons learned in Africa is that successful investing in Africa requires a disciplined approach, strong portfolio management, and an understanding of the local dynamics in each region. The selection of the right management teams and market leaders is crucial to medium-term success.
