Deal Book Investing for Growth - Portfolio company cases from fund managers across Africa, Asia, Emerging Europe, Latin America, and the Middle ...
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Investing for Growth Deal Book Portfolio company cases from fund managers across Africa, Asia, Emerging Europe, Latin America, and the Middle East.
EMPEA Deal Book 2021
A Message from the CEO
T
his inaugural Investing for Growth Deal Book seeks to illustrate in practical terms the real
impact of exemplary private capital investment in Asia, Africa, Latin America, the Middle East,
and Central & Eastern Europe.
Eighteen cases from EMPEA member firms span denim manufacturing in Vietnam, an R&D-driven seed
business in India, municipal waste management in Poland, online medical education in Brazil, wind
energy in Senegal, and a real estate logistics platform spanning China and Southeast Asia.
In part, this publication is a response to the widespread excitement over responsible investing globally,
which has dominated mainstream media and the promotion of fund products across asset classes,
creating both momentum for change and confusion over definitions, metrics, and expected outcomes.
Beyond the marketing language and tick boxes, private capital fund and institutional investors commit
hundreds of billions of dollars to companies and projects in our markets each year, where operational
capabilities are table stakes – success depends on the ability to execute, not timing market cycles
or financial engineering. In order to generate returns they must grow businesses, institutionalize
governance, enable technology, and build infrastructure, creating jobs and training workforces in
the process.
One fund manager described it to me as “ESG in action.”
Limited partners are right to demand transparency and standardization as they evaluate funds
promising to mitigate climate change or reduce income inequality. And LPs will not commit capital
unless they are guaranteed excellent governance at the GP level – backing trusted partners – as
protection from reputational risk or worse.
At the same time, standardized metrics and reporting will not capture the full, transformational effect
of long-term capital in our markets. This became evident as EMPEA worked closely with deal team
professionals and portfolio company CEOs over the last nine months to produce this publication; each
deal presented unique and complex challenges for management and investors, and outcomes should
be considered relative to local contexts.
EMPEA will be building on this work with subsequent publications and a rigorous awards program to
recognize excellence in our industry.
– Cate Ambrose
CEO, EMPEA
Disclaimer: EMPEA has taken measures to validate the information presented herein but cannot guarantee the ultimate accuracy or completeness of the information provided.
EMPEA is not responsible for any decision made or action taken based on information drawn from this publication.
© EMPEA 2021. All rights reserved. EMPEA encourages and grants permission for the distribution and reproduction of copies of this work for non-commercial purposes. Such
copies, in whatever form, must be unmodified, in their entirety, and include copyright notice and full attribution. Any adaptation, derivative work, or other modification requires
prior written approval by EMPEA.
EMPEA Deal Book 2021 1
EMPEA Deal Book 2021
About EMPEA
EMPEA is the global industry association for private capital in emerging markets. An independent, non-profit
organization, the association brings together 300+ firms—including institutional investors, fund managers,
and industry advisors—who manage more than USD5 trillion in assets across 130 countries. EMPEA supports
its members globally through research and intelligence, investor meetings, education, and advocacy.
EMPEA Leadership Circle Members
EMPEA Products & Programs
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The EMPEA Data Portal allows members to search for and download EMPEA’s annual report on venture-backed startups across emerging
underlying fund- and deal-level data. markets which includes data on VC fundraising and investments, as
well as market breakdowns including top VC deals by size, most active
venture investors, and tech sector highlights.
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EMPEA members receive mid-year and year-end Industry Data &
Statistics with detailed analysis and access to raw data, as well as GPEC
2-page region- and sector-specific breakdowns. The Global Private Equity Conference (GPEC), hosted by IFC in
association with EMPEA, is the world’s leading event dedicated to
exploring private investment opportunities across emerging markets.
Member Directory
Search profiles of 300+ EM fund managers, institutional investors,
and other industry stakeholders. Advanced search capabilities include Education & Training
keywords, firm name, firm type, HQ, and region. EMPEA maintains a curriculum of live and virtual practitioner-led
investor training for PE and VC fund managers, as well as EM-based
institutional investors.
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Annual survey featuring the views of 100+ LPs on the current
conditions and outlook for private capital in emerging markets. NewsWatch
Weekly newsletter with updates on the latest private capital
transactions and activity across Africa, Emerging Asia and Europe,
Investing for Growth Deal Book Latin America, and the Middle East.
Verified and detailed portfolio company cases from
fund managers across Africa, Asia, Emerging Europe,
Latin America, and the Middle East. Global VC Cache
A bi-weekly newsletter covering cross-border tech transactions and
innovations in a rapidly changing world.
EMPEA Deal Book 2021 2
EMPEA Deal Book 2021
Contents
Actis | Parc Eolien Taiba N’Diaye (PETN) [Africa] . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Adenia Partners | Mauvilac [Africa] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Affirma Capital | Fine Hygienic Holdings [Middle East] . . . . . . . . . . . . . . . . . . . . . . . 8
Baring Private Equity Asia | Interplex [Asia] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Crescera Capital | Afya [Latin America] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Development Partners International LLP (DPI) |
Eaton Towers Holdings Limited [Africa] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Everstone Capital Asia | API Holdings [Asia] . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
General Atlantic | Clip [Latin America] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Helios Investment Partners | Fawry [Africa] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Horizon Capital | Purcari Wineries [CEE & CIS] . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Linzor Capital Partners | UTEL [Latin America] . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Mediterrania Capital Partners | Aziza [Africa] . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Mekong Capital | Pizza 4P’s [Asia] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Navis Capital Partners | Saitex [Asia] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
True North | Seedworks International [Asia] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Turkven | Vansan Makina [CEE & CIS] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Value4Capital | Kom-Eko [CEE & CIS] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Warburg Pincus | ESR [Asia] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
EMPEA Deal Book 2021 3
EMPEA Deal Book 2021
The Investor: The Company:
Actis PETN
Fund Manager: Actis Company: Parc Eolien Taiba N’Diaye
Fund Name: Actis Energy 3 Website: www.taibaeolien.com
Fund Size: USD1.15 billion Industry / Sector: Energy
Total AUM: USD10 billion Location: Senegal
Actis is a global investor focused on growth markets Parc Eolien Taiba N’Diaye (PETN) is the first utility-scale
across Africa, Asia, and Latin America. Founded in wind energy platform in Senegal and the largest wind
2004, Actis has raised USD19 billion since its inception, farm in West Africa. One of several projects being
investing in more than 200 companies and realizing over developed by Lekela Power, PETN will provide 158.7
165 exits. The firm has a team of over 300 employees, megawatts (MW) of clean, reliable power to Senegal’s
including over 120 investment professionals, operating electricity grid once completed in 2020. It is designed to
out of 17 offices globally. operate for a minimum of 20 years, while providing power
to over two million people.
Date of Investment: Amount: Participation / Stake:
June 2016 ~USD330 million* 60%
Opportunity
When Actis began evaluating the 158 megawatt Actis had recently partnered with Mainstream discussions to see how their lives and the region
(MW) Parc Eolien Taiba N’Diaye (PETN) project Renewable Power to build Lekela Power, a could be improved by hosting a wind farm in
in 2016, it saw an opportunity to transform USD1.9 billion renewable energy platform, and the area.
the Senegalese power sector by building the was actively searching for opportunities across
country’s first utility-scale wind power plant. Africa. PETN fit well within this platform as a
At the time, only 65% of the population in commercially attractive greenfield investment
Senegal had access to electricity, while 88% of in a historically challenging market. Taiba
the country’s generation capacity was sourced N’Diaye was a relatively poor rural
via burning oil and diesel, according to World community, located approximately
Bank estimates. Senegal additionally had one 70 kilometers northeast of
of the highest generation costs in the world Dakar, and was vulnerable
due to its reliance on imported fuel. Despite to increasingly frequent
these challenges, Actis recognized that Senegal and prolonged periods of
boasted one of the best wind resources in Africa, drought—particularly as only
and valued that the project had the support 5% of the land was irrigated.
of the Senegalese government, which was By the time Actis began
vocally committed to developing the country’s looking at PETN, people in the
renewable power sector in order to halt chronic local community were already
electrical outages and achieve greater energy well informed regarding the
independence. project and were open to further
*Representing an equity investment by Lekela Power, which is a joint venture between Actis (60%) and Mainstream
Renewable Power (40%), as well as debt financing provided by the Danish Export Credit Agency (EKF) and the U.S.
International Development Finance Corporation (DFC)
EMPEA Deal Book 2021 4
EMPEA Deal Book 2021
Execution Spotlight:
Actis’ impact-led investment approach was a key transportation typically began at night in order to Engaging a
factor in Lekela winning the competitive process
to acquire the PETN project and sell electricity to
minimize disruptions to villages along the route.
Community
state-owned utility Société Nationale d’Electricité In late 2018, construction on the wind power Because the site was located in an
du Senegal (Senelec) through a 20-year power plant commenced. At peak construction, agricultural area—and construction of
purchase agreement. An immediate priority for PETN employed 902 people, with 294 workers the wind farm and access to associated
Lekela was recruiting community liaison officers from the Taiba N’Diaye region, 536 from roads would result in some farmers being
economically displaced—Actis and Lekela
and a local management team, including a Senegal and 72 expatriates. PETN generated
participated in ongoing consultations with
dedicated ESG group. The team also negotiated 18 permanent skilled jobs in the management
those affected by the project to develop a
the Engineering, Procurement and Construction team, 16 of which are held by Senegalese livelihood restoration plan and ultimately
(EPC) contract with the turbine supplier. nationals. Actis and Lekela organized trainings solidify their support for the project. PETN
for the employees, particularly on safety and assisted 415 families with transitional
Actis and the Lekela team then faced the construction techniques. Having to also account financing, land and crop replacements,
logistical challenge of transporting equipment for the safety of curious community members financial management training and irrigated
garden establishments—and continues to
such as 138 turbine blades, each 60 meters keen to watch the plant being built, Lekela
monitor those families on an ongoing basis.
in length, and 46 Vestas wind turbines, each undertook various initiatives such as speaking at
180 meters in height, from the port in Dakar schools to educate people on the risks of being Lekela and Actis also examined how others
to Taiba N’Diaye. The mostly rural and narrow in operation areas and asking bystanders to stay living in Taiba N’Diaye might be negatively
roads presented challenging conditions, so a minimum of 300 meters away from turbine affected by the project. The women’s
road turnings had to be modified, while turbine components. agricultural economy became one focus
point after seeing how heavy vehicles
coming in and out of the region could pose
a health and safety risk to those selling
produce on the side of a busy main road. At
the request of a local women’s association,
PETN provided a new marketplace in Taiba
N’Diaye in November 2019 with over 60
covered stalls. The first monitoring and
evaluation survey confirmed that all of the
women interviewed had seen an increase
in revenue and improved health since
moving to the central marketplace. Actis
also worked with PETN to build a new
Information Technology Centre for the Taiba
N’Diaye High School in October 2019 and
Outcome has supported the funding of 12 technical
traineeships.
PETN is currently the largest wind farm in the PETN was officially inaugurated in February
In 2020, Lekela prepared the Taiba N’Diaye
West Africa region and is on track to expand 2020 by Senegalese Head of State Macky Sall
community for the COVID-19 pandemic.
Senegal’s total electricity generation capacity and has been well received by local government
In collaboration with Actis’ neighbouring
by 15%. It began operating the first 55.2 MW officials due in large part to the community thermal power plant Tobene Power, Lekela
of the project in November 2019, and the investment programs Actis helped put in met with community groups throughout
remaining 103.5 MW reached completion in place. Having a world class wind farm on their the region, including schools, mosques,
December 2020. Once fully commissioned, doorstep has also become a source of pride for and women’s health groups to distribute
PETN will generate 400 gigawatt hours (GWh) people living within the region. As a private information pamphlets and soap. Women
of clean electricity annually to over two equity investor Actis will seek to generate a were encouraged to start sewing masks,
hand washing stations were established,
million people for a minimum of 20 years. profit by selling its stake in PETN in the next
and food parcels were distributed to
The project will also offset approximately several years, but the long-term partnership the most vulnerable members of the
six million tons of carbon over the next two with the Taiba N’Diaye community will also be a community.
decades and significantly reduce the cost of lasting part of its track record.
electricity in Senegal from the current price of
approximately USD0.30 per kWh.
EMPEA Deal Book 2021 5
EMPEA Deal Book 2021
The Investor: The Company:
Adenia Partners Mauvilac
Fund Manager: Adenia Partners Company: Mauvilac
Fund Name: Adenia Capital (III) Website: www.mauvilac.mu
Fund Size: USD113 million Industry / Sector: Paint and coatings
Total AUM: USD400 million Location: Mauritius
Founded in 2002, Adenia Partners is an Africa-focused Mauvilac manufactures and distributes decorative and
private equity firm operating across five offices in the specialty paints and coatings. Founded in 1964, Mauvilac
region. With a target ticket size of between USD12 million sells its products directly through five concept stores
and USD80 million, Adenia invests exclusively in controlling in Mauritius and indirectly via a network of over 1,000
stakes in sectors including agribusiness, manufacturing, hardware stores across the Indian Ocean region. By 2020,
financial services, telecommunications, hospitality, and Mauvilac had captured a greater than 50% market share of
health care. To date, Adenia has raised four funds, made 25 the Mauritian paint industry.
investments, and realized 15 exits.
Date of Investment: Enterprise Value: Participation / Stake:
July 2014 USD43 million 95%
( as of March 2020 )
Opportunity
The Maurel family built Mauvilac, a paint and each acquisition; in the case of Mauvilac, it was social management system, optimizing product
coatings business, into the flagship brand in clear that the optimal outcome would be to sell range, and expanding the distribution network.
Mauritius over 50 years, and was exploring its stake to a leading paint company. The firm
a sale in 2014. The Maurels believed that contracted Laurent Roussel, a former Managing
the company might be a good fit for Adenia Director in the paint industry with more
Partners, one of the few private equity than ten years of business, compliance,
investors in Sub-Saharan Africa interested in and marketing experience, to
acquiring controlling stakes. Impressed by identify areas for improvement
Mauvilac’s renowned brand and track record of that would ultimately move
profitability in a non-cyclical industry with high Mauvilac in line with global
barriers to entry, Adenia acquired 95% of the standards. With Roussel’s help,
company’s shares, with the remaining shares Adenia designed a strategic
staying in the hands of the founding family. plan around modernizing
governance, improving the
As part of its investment process, Adenia facilities, implementing a
deliberates exit scenarios at the beginning of formal environmental and
EMPEA Deal Book 2021 6
EMPEA Deal Book 2021
Execution Spotlight:
During the first few months immediately manual to a semi-automatized process while Innovating a
following the acquisition, Adenia’s
modernization plan for Mauvilac was slow to
also making the facilities more modern and
environmentally friendly. Waste management
Local Industry
materialize due to organizational inertia. When and solvent recycling systems were implemented Research and development is core to
it became clear that a new CEO was needed to in line with the development of a formal Mauvilac’s business strategy. Spending
champion the transformation of the company, environmental and social management system. between 3-5% of revenue annually on
Adenia recruited Roussel for the role. As the new Though Mauvilac produces mostly water-based research initiatives, the company stands
apart from its competitors by regularly
management team adopted a more inclusive paints, the company did not want to contribute
launching new products and seeking to
and collaborative approach, the company began to local pollution and therefore made additional
improve existing ones. For example, in
to implement new initiatives. investments to prevent any leakage from its 2018 Mauvilac launched Imperial White, a
facilities into the nearby environment. product that has 90% more coverage than
One key focus was improving the job quality of traditional white paint. Another innovative
Mauvilac’s 250 employees. Adenia strengthened Over its six-year investment period, Adenia product that saw commercial success was
the company’s human resources function— drove forward innovations around Mauvilac’s an antibacterial paint called Nanotech.
As of September 2020, the Nanotech line
an employee handbook was created, job products and expanded the company’s
has helped the company exceed last year’s
descriptions were reviewed for all employees, distribution network, with the company
year-to-date sales despite the COVID-19
and large training programs were organized on capturing a greater than 50% market share pandemic as consumers keen to make their
topics such as operational excellence, quality in Mauritius by 2020. At the time of Adenia’s homes and offices less receptive to viruses
management, and safety. For example, 60% acquisition, Mauvilac had three concept stores eagerly purchased the product.
of Mauvilac’s employees received external on the island where customers could purchase
training on the ISO management systems. Safety products directly. Recognizing that these Adenia further sought to optimize
measures were also introduced at the plant, stores increased customer loyalty and provided Mauvilac’s product range by supporting the
development of the Go Green label, which is
including the addition of floor markings for better profit margins, Adenia encouraged the
the first environmentally friendly paint line
pedestrians, enforced use of safety equipment company’s management to open two additional in Mauritius. In addition to being produced
and close monitoring of safety performance locations, bringing the total to five by the time through greener production processes and
on site. As a result, work accidents—defined of Adenia’s exit. Adenia also sought ways to using recycled materials for packaging,
as accidents leading to at least one day of sick distribute Mauvilac’s products beyond Mauritius Go Green paints have significantly lower
leave—have decreased by 44%. to neighbouring islands; the company began amounts of volatile organic compounds
selling products in Madagascar in 2019 and is (VOCs) than traditional paint. Approximately
3,000 tons of VOCs have been saved in
Adenia invested in upgrades to the factory, currently prospecting in the Seychelles.
the last three years through the use of
including moving production from a mostly
Go Green products. The label has seen
tremendous success, representing 91% of
the volume of the company’s total water-
based paint sales in fiscal year 2019. While
Mauvilac pioneered the development of
environmentally friendly paint products in
Mauritius, its competitors have subsequently
entered the market, which has a positive
impact on the broader environment.
Outcome
As Adenia began to move into the exit process, in-class operating and governance standards, performance coatings manufacturer worldwide
several international strategic and financial in line with ISO 9001, ISO 14001, and ISO at the time. With an approximate enterprise
buyers expressed interest in Mauvilac. As a 45001 certifications, respectively, for quality, value of USD43 million, AkzoNobel valued
result of the improvements implemented by environmental and occupational health, and the company at 10x EBITDA—versus 7x at the
Adenia around productivity, product line, safety management. time of acquisition. The exit is a testament to
and distribution, Mauvilac’s EBITDA margins Mauvilac as a leader in innovation, branding,
increased by 65% between the time of In January 2020, Adenia sold its stake in and infrastructure which buyers may not have
acquisition and exit. Prospective buyers were Mauvilac to AkzoNobel, a Dutch multinational expected to find in a relatively small emerging
also impressed by Mauvilac’s adoption of best- company that was the third largest paint and market like Mauritius.
EMPEA Deal Book 2021 7
EMPEA Deal Book 2021
The Investor: The Company:
Affirma Capital Fine Hygenic
Fund Manager: Affirma Capital
Holding
Fund Name: Undisclosed Company: Fine Hygenic Holding
Fund Size: Undisclosed Website: www.finehh.com
Total AUM: USD3.5 billion Industry / Sector: Fast-moving consumer goods
Affirma Capital is an independent emerging market private Location: Middle East and North Africa
equity firm that was established through the spin-off
Fine Hygienic Holding (FHH), with headquarters in Dubai,
of Standard Chartered Private Equity from the Standard
UAE and Amman, Jordan is a vertically integrated hygienic
Chartered Group in 2019. The team has deployed over
paper product manufacturer and wellness company. Using
USD5.5 billion in over 90 companies across Asia, Africa,
sustainably sourced raw materials, the company’s main
and the Middle East in its 18-year history of working
products include tissues, diapers, and jumbo reels, as well
together. Affirma Capital has offices in Singapore, Dubai,
as its Fine Guard line of face masks, gloves, and disinfectant
Johannesburg, Mumbai, Shanghai, and Seoul.
wipes. With over 3,400 employees, FHH operates five paper
mills and over 80 converting lines across the Middle East
and North Africa.
Date of Investment: Amount: Participation / Stake:
May 2015 USD225 million Undisclosed
( includes co-investors)
Opportunity
Palestinian refugee Elia Nuqul founded Fine time was still operating as Standard Chartered
Hygienic Holding (FHH) in Jordan in 1958, Private Equity, had a successful track record
seeing an opportunity to sell affordable of working with family-run
hygienic paper products, which were not mid-size businesses in the
widely available in the Middle East and North region. Keen to back an
Africa (MENA) region. The company grew over established consumer brand
the following decades, expanding into Saudi with a diversified product
Arabia, Egypt, and the UAE. By 2015, the offering, Affirma Capital built
founding family began to search for a partner a consortium that invested
who could not only provide financing but USD225 million in FHH in
also help FHH further expand its operations May 2015.
geographically. Affirma Capital, which at the
EMPEA Deal Book 2021 8
EMPEA Deal Book 2021
Execution Spotlight:
Affirma Capital’s initial priority post- organizational structure, creating a Breaking Down
investment was to help the company
strengthen its position as a regional leader.
centralized and diversified procurement
strategy to reduce raw material costs, and
Gender Barriers in
To increase product availability, the firm improving manufacturing inefficiencies. For the MENA Region
assisted FHH in securing financing for a new example, facial tissue and toilet paper is
state-of-the-art paper mill in Abu Dhabi in typically made through a two-step process— With over 3,400 employees, FHH has
2017, which expanded production capacity prioritized creating a corporate culture that
pulp is converted into jumbo rolls at a paper
can attract global talent with competitive
by approximately 30% to 210,000 tons. mill and those rolls are then transformed
benefits. In particular, the Affirma Capital
However, in the latter half of 2017, FHH was into the final product through a converting team has worked closely with FHH to
confronted with multiple challenges. The line. FHH ensured that these processes were promote gender diversity within the
price of its primary raw material, pulp, had taking place in the same location and that all organization. Since 2018, FHH has added
increased to unprecedented levels by over machines were functioning at optimal speeds. four women to senior leadership roles,
60% between January 2017 and December To reduce costs, the team carefully evaluated which account for approximately 24% of the
2018 due to a combination of spiking which markets would be the cheapest leadership positions in the company.
demand from China and supply disruptions in to produce various products and nimbly
In Saudi Arabia, FHH hired the first female
an oligopolistic, supply-constrained market. purchased pulp at both spot and contract sales representatives in the fast-moving
At the same time, a decline in oil prices was rates, depending upon which offered the consumer goods industry—a breakthrough
leading to reduced spending in the Gulf most favorable terms. concept for the more traditional market—
Cooperation Council countries, and a 40% and has established production teams in
devaluation of the Egyptian currency in late Perhaps most importantly, Affirma Capital the local factory that are completely staffed
2016 was reverberating across its economy. and the new management team began to and run by women. For all of its employees,
FHH has adopted a “work from anywhere”
transition FHH into a wellness company
arrangement in part to support working
FHH needed to reinvent itself to compete in by launching premium, value-added, and
mothers, while its maternity policy—
an environment in which end product prices innovative products that could command with 16 paid weeks—is one of the most
needed to increase in order for the company higher margins and reduce FHH’s dependency progressive in the MENA region. In 2018,
to remain profitable, yet consumers were on pulp. FHH was one of the first regional FHH was recognized as a global leader in
increasingly cost conscious. Affirma Capital companies to produce a colds- and allergies- promoting gender diversity and women’s
recognized that new leadership was needed focused tissue (Fine Rx). Launched in 2019, empowerment, receiving several “Break the
Ceiling, Touch the Sky” Leonie Awards (also
to strengthen the core business, differentiate Fine Rx is a three-ply sterilized and medicated
known as the Global Gender Diversity and
FHH’s product offering, and ultimately drive line of tissues made with decongestant oils.
Leadership Excellence Awards).
the company’s turnaround; in early 2018, With Affirma Capital’s support, in February
James Michael Lafferty was recruited as CEO. 2020, the company developed its Fine Guard
With over 30 years of experience, Lafferty product line, which includes face masks,
previously held leadership roles at P&G, Coca- gloves, and disinfectant wipes, in response
Cola, and British American Tobacco, and was to the COVID-19 pandemic. Recognizing the Livinguard Technologies to incorporate a
already serving on FHH’s board. burden that disposable masks will place on patented technology within these products
the environment, FHH’s masks are reusable that has been clinically proven to kill 99.9% of
FHH’s turnaround strategy focused with each replacing 210 disposable masks. bacteria and viruses.
on eliminating redundancies in the FHH has also partnered with Switzerland’s
Outlook FHH’s commitment to gender diversity is creating a
FHH has broadened its reach in partnership
ripple effect across the MENA region as fast-moving
with Affirma Capital and currently has an consumer goods players replicate the company’s
active presence in nine MENA markets with policies. Although women continue to be largely
exports to over 75 countries. As of October
2020, the company has over USD500 million
underrepresented in the workforce, there is a lot of
in annual sales. Going forward, Affirma Capital impetus for change across the MENA region and
will continue to support FHH’s transition to FHH is at the forefront of this movement.
a wellness company by helping it expand its
product line-up, move into complementary – Taimoor Labib
product categories (e.g., health beverages and Founding Partner, Head of MENA and Chairman of
supplements), and further expand within the
region and into select export markets.
Africa, Affirma Capital
EMPEA Deal Book 2021 9EMPEA Deal Book 2021
The Investor: The Company:
BPEA Interplex
Fund Manager: Baring Private Equity Asia Company: Interplex
(BPEA) Website: www.interplex.com
Fund Name: The Baring Asia Private Equity Fund VI Industry / Sector: Value-added manufacturing
Fund Size: USD3.99 billion Location: Global
Total AUM: USD21 billion
Interplex provides advanced interconnect and high-
Established in 1997, Baring Private Equity Asia (BPEA) is precision engineering solutions for the automotive, health
an Asia-focused private equity firm with nine regional care, data communications, and telecommunications
offices and over 190 employees. As of October 2020, the industries. With 14,000 employees, the company has
firm has invested in over 100 companies and realized 53 operations in 13 countries across Asia (primarily Singapore,
exits.1 BPEA typically invests through either a controlling China, India, Indonesia, Malaysia, and Vietnam), Europe,
or significant minority stake in companies with enterprise and the Americas, including ten product development and
values between USD300 million and USD1.5 billion. 28 manufacturing sites.
G L O B A L
Date of Investment: Pre-Privatization Market Capitalization: Participation / Stake:
March 2016 USD283 million 100%
( as of December 2015, Singapore Exchange)
Opportunity
Baring Private Equity Asia (BPEA) had been Interplex’s diversified global client base
closely following the precision engineering included some of the world’s largest tier 1
industry—a fast-growing sub-segment of the car manufacturers, data communications
manufacturing outsourcing sector—since providers, and medical companies. In
2005. Singapore-headquartered Amtek addition, the company’s broad footprint,
Engineering’s 2014 acquisition of US-based which spanned China, India, Southeast
Interplex Industries had caught the private Asia, Western and Eastern Europe,
equity firm’s attention—the company’s share the United States, and Mexico,
price on the Singapore Exchange had fallen created opportunities for
by more than 30% since its 2010 public localized manufacturing. With
listing and the BPEA team believed that the the investment thesis that the
merger was fundamentally misunderstood right management team could
and undervalued. The merged company, called leverage these competitive
Interplex, combined Amtek’s mechanical advantages and transform
precision engineering capabilities in areas the business, BPEA privatized
such as metal stamping, cold forging, and Interplex in March 2016,
plastic and rubber molding with Interplex acquiring 100% of the company
Industries’ miniaturized application-specific in the process.
interconnect expertise, thus offering the
potential to provide a comprehensive solution
to customers.
EMPEA Deal Book 2021 10EMPEA Deal Book 2021
Execution Spotlight:
Post-acquisition, BPEA’s primary challenge were asking the company to simultaneously Building a Culture
was to fully integrate Amtek and Interplex
Industries. The companies were similar in size
bid for the same project from both China
and Mexico, for example, and receiving two
Around Quality
prior to the merger yet had vastly different different quotes. BPEA created a new front- Control
cultures as Interplex had been a family-run end organization, which included investing
business before being acquired by the more in Interplex’s sales and product development During BPEA’s initial investment period,
institutionalized Amtek. In the first few months Interplex was suffering from quality issues
teams. Dedicated account managers were
across its factories due to a prior lack of
following its investment, BPEA recruited Alex designated for each key global customer—an
investment. BPEA hired a dedicated Vice
Perrotta, who had previously run connector initiative that has been particularly successfully President of Quality to develop an action
solutions manufacturer FCI Electronics, to serve in light of the COVID-19 pandemic as plan and build a company-wide department
as the Chief Executive Officer and develop a customers have been able to quickly receive that included regional quality managers
new blueprint for the business. The private updates on orders and shipments, giving them and a quality team at each facility. Adopting
equity firm also replaced over ten senior the ability to better manage their supply chains. a “zero defects” approach throughout its
management team members and appointed operations, Interplex’s facilities are now
equipped with state-of-the-art testing
two independent directors with extensive As Interplex reconfigures its product mix and
equipment, and quality is embedded across
industry experience to support Perrotta and his value proposition, it has been able to move the company’s value chain from product and
growth plan for Interplex. into environmentally friendly industries such tooling design to process controls, as well as
as the growing hybrid and electric vehicle reliability testing and failure management.
Under Perrotta’s leadership, Interplex narrowed automotive (EV) market. In the last 12 months, Interplex introduced Interplex Business
its focus from eight market segments to three the company has secured multimillion-dollar System (IBS) globally to create awareness and
high-margin verticals: automotive, medical/life contracts with one of the world’s largest educate the organization on the importance
of the lean system and the value of layer
sciences, and data communications. As part EV manufacturers and will be involved in its
process audits, and simultaneously began the
of its strategy to refocus on more profitable battery distribution system. In addition, the
company-wide certification of factory lines as
services, Interplex has been transitioning company has been focused on minimizing the Bronze, Silver, or Gold.
from a “build-to-print” to “build-to-spec” environmental impact of its internal operations.
business, meaning that Interplex can design, For example, as of October 2020, Interplex has The BPEA and Interplex teams recognized
engineer, and manufacture a product to solve converted 65% of the total lighting in its global that quality was intricately tied to employee
problems for customers who are increasingly manufacturing facilities to LED lighting, has involvement. Experienced technicians and
engineers are at the heart of Interplex’s
requiring a value-added supplier capable begun to install solar panels, and completely
business model, so BPEA has worked with
of supporting greater design complexities. eliminated the use of plastic water bottles in
the company to develop a retention program
BPEA’s investments in Interplex’s research and all of its sites, which would have equated to while also broadening the workforce to
development capabilities, including through its 1.2 tons of waste in fiscal year 2020. It has include retirees and workers over the age
three Technology Innovation Centers and nine also planted 9,766 trees and intends to plant of 60 as consultants and contractors.
Product Development locations, have been core an additional 3,000 mature native trees at its By bringing in these experts, Interplex
to this initiative. properties, as well as one million trees within gains decades of work experience and an
established work ethic with each employee.
local communities, by the end of 2021.
As keeping its staff safe is also critical to
Prior to BPEA’s acquisition, Interplex had been
ensuring quality, Interplex has adopted
largely operating in silos. As a result, customers rigorous risk and hazard assessments, the use
of stringent safety equipment, and frequent
trainings on safety.
Outlook
In partnership with BPEA, Interplex’s group prune low margin or non-strategic business represent a large portion of Interplex’s pipeline.
revenue has grown to approximately lines and customers. Looking forward, BPEA With an improved sales organization and
USD1 billion in fiscal year 2020. With the is positioning Interplex to capitalize on product solutions team, Interplex achieved
transformation of the sales and product global trends such as the electronification more than USD1 billion in new wins across
development teams complete, BPEA is of cars, advances in healthcare and universal all sectors in fiscal year 2020, representing a
currently prioritizing helping Interplex renew connectivity—all while keeping the focus on significant increase over the previous year.
and grow programs while continuing to customized “build-to-spec” solutions, which
EMPEA Deal Book 2021 11EMPEA Deal Book 2021
The Investor: The Company:
Crescera Capital Afya
Fund Manager: Crescera Capital Company: Afya Ltd.
Fund Name: Crescera Educacional II FIP Multiestratégia Website: ir.afya.com.br
Fund Size: USD430 million Industry / Sector: Education and trainings, services and
Total AUM: USD1 billion (BRL5.2 billion) consumer
Location: Brazil
Crescera Capital is a Brazil-based private equity and venture
capital investment manager with a focus on education, Afya Educacional is a medical education group focused on
health care, consumer goods, specialty retail, services, the lifelong learning career of physicians in Brazil through all
innovation, and technology. Since 2008, Crescera’s private stages of their career. The company’s purpose is to produce
equity team has invested predominantly growth capital into and distribute high-quality content and manage the entire
15 portfolio companies and 23 investments. professional journey of its students by offering solutions and
trainings based on cutting-edge educational technologies.
The company is situated in 13 Brazilian states plus Brasília,
while its digital platform is available nationwide.
Date of Investment: Amount: Initial / Current Stake:
January 2016 ~USD156 million 37.5%* / 25.9%
( *before first divestment)
Opportunity
Crescera Educacional II FIP Multiestratégia education in the country Afya continued to programs, and continuing medical education
targets investments in thematic education. In integrate additional schools and technology activities, or CME.
2012, the team targeted Brazil’s medical sector companies. Afya increased its annual
in response to a lack of quality education and authorized seats in the medical course to 2,303
poor penetration beyond the country’s largest while expanding its offering to health
cities. Crescera believed that technology was professionals beyond doctors, dentists,
a key feature to provide a more effective and and nurses.
personalized learning experience to students
nationwide and would allow students in remote With its innovative
areas to access the same high-quality content methodological approach which
delivered in major cities in the country. When combines integrated content,
it became evident that such a company didn’t interactive learning, and an
exist, Crescera decided to create one. adaptive experience for lifelong
medical learners, it generated
Crescera identified a number of companies and delivers an end-to-end
across the fragmented sector to become part physician-centric ecosystem that
of a platform where students could be at the serves and empowers students
center of their education. Crescera acquired to be lifelong medical learners
three companies – NRE, Medcel, and Uniceplac through their medical residency
– consolidating them into Afya Educacional in preparation, graduation program,
2019. With the goal of revolutionizing medical medical post-graduate specialization
EMPEA Deal Book 2021 12EMPEA Deal Book 2021
Execution Spotlight:
Crescera’s investment team has been responsible to the academic programs, the adoption of Bringing Medical
for identifying and executing acquisitions,
including negotiating with the various schools
digital solutions, and the development and
deployment of new educational products,
Education to
and any subsidiary minority shareholders. In including a television series focused on clinical Rural Brazil
addition to educational institutions, Crescera cases that features both real doctors and actors.
has been looking for complementary technology With Crescera’s support, operating efficiencies In addition to expanding via acquisitions,
companies. For example, in July 2020, Afya increased and Afya’s net revenues grew at a Afya has opened new schools, including
one in Palmas, Tocantins in 2017. Through
acquired PEBMED, a mobile and web application compound annual growth rate of over 86%
the Mais Médico program, a government
that helps doctors and medical students make between the end of 2017 and 2019. program which seeks to increase the
faster and more accurate clinical decisions number of medical professionals in
through medical calculators, conducts, Crescera considered an eventual public offering underserved areas, Afya was awarded
prescriptions, procedures, and other content for Afya since its formation. Thus, instituting a seven out of 28 new campuses—the most
related to over 28 specialties. formal auditing process and installing robust granted to any education group—based
corporate governance structures, including a on both financial and educational metrics.
These campuses are located in the north
Integrating all of these various entities has been board of directors with independent members,
and northeast regions of Brazil, which have
a key focus of the firm. Crescera established a was highly relevant from the start. A Compliance historically had a shortage of physicians. The
holding company with a management team Department led by a Compliance Officer average ratio of physicians per thousand
responsible for implementing and supervising a reporting directly to the CEO and board was inhabitants is 1.9 in the cities where Afya’s
shared service center to consolidate all non-core created with full autonomy. In partnership schools are located, well below the average
administrative processes including purchasing, with Afya’s Ethics Committee, the Compliance of 2.2 in Brazil and 3.4 for OECD countries.
human resources, finance, IT, and the Department is responsible for organizing and
Since many of Afya’s schools are located in
management of classes and professors. Afya has promoting frequent trainings for all 5,000
regions where medical services are scarce,
also unified the curriculum, including updates employees.
the students are able to make a positive
social impact on the local population
through free medical consultations and
Brazil’s problem is not that it lacks a sufficient number of treatments. In 2019, the medicine course
doctors; it is one of distribution. We have more doctors in alone promoted more than 270,000 free
consultations while those campuses that
São Paulo per 1,000 occupants than in Switzerland, but operate dental clinics collectively serviced
very few in places like Amazonia. Crescera and Afya are more than 70,000 appointments. The
students of IPEMED, which Afya acquired
striving to attract a range of health care professionals to in 2019 and offers specialized post-
more rural areas—and hopefully many will stay once they graduate medical programs, offer free care
to low-income patients one weekend per
graduate, thus bringing value to the local communities. month. Communities can also access care
in biomedicine, physical therapy, speech
– Laura Guarana therapy, nutrition, and psychology.
Partner, Crescera Capital Afya is providing a significant amount
of medical content for free in order
to lessen the negative impact of the
COVID-19 pandemic on other public and
private medical schools across Brazil. As
Outcome of September 2020, more than 11,000
medical students have already accessed
content on Medcel, the company’s distance
Afya became the first Brazilian company focused expand medical training with places for another
learning medical program platform. Afya
on medical education to be listed on the US 1,000 students; 851 of these were in place by
has also developed a free course to train
Nasdaq Stock Market in 2019, raising over October 2020. In addition, Afya is developing health professionals on how to care for
USD264 million and marking the first medical greater in-house technologies to deliver content COVID-19 patients, covering subjects such
education company to trade on the exchange to additional doctors across Brazil, focusing on as mechanical ventilation, respiratory
globally. Crescera divested a portion of its stake underpenetrated markets. Crescera and Afya emergencies, and diagnostic imaging, with
in February 2020 through a follow-on offering view themselves as a partner to the regional over 23,000 participants and 34 institutions
of approximately USD89m, reducing its holding municipalities—the concentration of aspiring enrolled. The company has separately
donated masks, gloves, and safety
from 37.5% to 26.1%, currently 25.9%. health professionals can often lead to greater
equipment to hospitals in the 13 cities
health infrastructure investment, with a positive where Afya’s medical courses are located.
Through the IPO process, Crescera and Afya impact on the local economy.
announced that they would use the proceeds to
EMPEA Deal Book 2021 13EMPEA Deal Book 2021
The Investor: The Company:
DPI Eaton Towers
Fund Adviser: Development Partners
Holdings Ltd.
International (DPI)
Company: Eaton Towers Holdings Limited
Fund Name: African Development Partners I (ADP I),
Website: www.americantower.com
African Development Partners II (ADP II)
Industry / Sector: Telecommunications
Fund Size: ~USD400 million (ADP I), USD725 million (ADP II)
Location: Uganda, Ghana, Kenya, Burkina Faso, and Niger
Total AUM: USD1.7 billion
Founded in 2008, London-headquartered Eaton Towers was
Development Partners International (DPI) is a pan-African
an independent tower company that acquired, built, and
private equity firm established in 2007. As of October
managed shared telecommunications infrastructure across
2020, DPI had invested in 22 portfolio companies across 29
Africa. By leasing towers to multiple mobile operators, the
countries through three private equity funds. DPI typically
company helped them reduce capital expenditures and
commits between USD40 million and USD120 million in
operating costs. By the end of 2019, Eaton Towers owned
equity per investment.
5,700 telecommunications sites.
Dates of Investment: Amount: Date of Exit:
December 2008, Undisclosed December 2019
June 2015
Opportunity
Shortly after Development Partners networks leapfrogging fixed-line infrastructure operators in 13 Sub-Saharan African
International (DPI) was founded in 2007, the across the region. DPI saw a market opportunity countries—marking DPI’s debut fund’s first
team recognized that telecommunication to build a towers company that could also investment. DPI’s thesis was that Q-Venture
towers infrastructure sharing was likely to catalyze greater economic development by would form the nucleus of a broader platform
become a prominent trend across Africa. supporting the growth of digital infrastructure that would not only build towers but also own
Businesses focused on tower sharing were and connectivity across Africa. and manage them on behalf of operators,
already well established in Western markets and giving the firm an early mover advantage once
trading at high multiples. At the time, mobile In December 2008, DPI invested in Q-Venture, tower sharing and outsourcing took off in
telecommunications companies such as Celtel a South African company that was building the region.
were expanding rapidly in Africa, with cellular towers on behalf of mobile telecommunications
While Eaton Towers’ initial interest in renewable and hybrid energy solutions was
largely driven by the high cost of diesel, it developed a robust sustainability culture
that not only made the company more efficient, but also better able to sell its product.
For example, as clients increasingly wanted to understand the carbon emissions in
their supply chains, Eaton Towers was already well positioned to discuss this along
with its overall environmental performance.
– Michael Hall
Head of ESG and Impact, DPI
EMPEA Deal Book 2021 14EMPEA Deal Book 2021
Execution Spotlight:
The DPI team faced a number of challenges early Private Equity Fund (CIPEF) partnered to Enabling Safety
in its investment. Q-Venture’s business model
had been negatively affected by a change of
purchase portfolios of towers, committing
USD150 million, followed by an additional
and Sustainability
payment terms in the industry that resulted USD198 million in 2013. In 2015, CIPEF, DPI strived to ensure that Eaton Towers
in tower construction companies receiving which had become the company’s controlling and its subcontractors—who carried out
payments post construction. This resulted in shareholder, was joined by a consortium that most of the company’s work—implemented
an adverse working capital cycle for Q-Venture included Ethos Private Equity and Standard best-in-class environmental, health, and
safety management practices. Safety was a
that significantly worsened the unit economics Chartered Private Equity in a USD350 million
particular focus for DPI as Eaton Towers had
and attractiveness of the business. DPI and the financing round to further expand and
thousands of sites scattered across often
Q-Venture management team needed to convert diversify Eaton Towers’ portfolio. This included remote environments. Most of these places
the distressed tower building business into a purchasing over 3,000 towers from Airtel in were not on the grid so the company had
tower ownership company. Transformation Ghana, Uganda, Kenya, Niger, and Burkina Faso. to initially depend on diesel generators.
began in 2010, when Q-Venture was awarded DPI also participated, investing through its ADP With diesel being a valuable commodity in
a contract in Ghana with Vodafone to take over II fund. the region, fuel theft became a frequent
the management of its portfolio and source problem and consequently put local staff,
including the technicians and security
additional tenants on those towers. DPI realized To ensure the towers were run efficiently post-
guards, at risk. DPI worked closely with the
this pivot required different management skills acquisition, DPI worked to bring in a Chief Eaton Towers team and its subcontractors to
and it led Q-Venture’s acquisition of Eaton Operating Officer who had previously worked put in place safety protocols in partnership
Telecom Infrastructure in late 2009 to gain an for American Tower Corporation, a global with local authorities.
executive team with broad experience in owning owner and operator of wireless and broadcast
and operating telecommunications networks communications infrastructure. Eaton Towers The costs and safety risks associated with
across the continent. The merged entity was was able to increase margins through efficiency diesel led Eaton Towers to focus on energy
efficiency and finding cheaper alternatives.
rebranded as Eaton Towers. gains (including energy savings initiatives),
The company implemented hybrid solutions
additional colocations and an effective build- that could harness solar power in each
The towers ownership business required to-suit program, in which towers are built country, which not only reduced its carbon
significant capital to acquire blocks of towers as with contracts already in place to guarantee footprint but lowered operating costs,
the best opportunities arose. DPI’s ADP I fund immediate revenue. This resulted in an EBITDA particularly given that these systems
was already fully committed, so the private margin of approximately 58% as of December required a less intensive maintenance
equity firm began a search for additional equity 2018—higher than those achieved by direct schedule. Eaton Towers was the first ADP
portfolio company to assess and have Scope
and debt investors. In 2011, Capital International competitors.
1 and 2 greenhouse gas emissions verified
across the organization when the company
became ISO 14064 greenhouse gas certified
in 2018.
Outcome
By 2019, Eaton Towers had 5,700 towers Eaton Towers’ South African operations. Having trying to understand the local regulatory
across Ghana, Uganda, Kenya, Burkina Faso, already established a relationship, American requirements and tax laws related to a merger
and Niger, and was serving many of Africa’s Tower and Eaton Towers entered discussions in each market. After approximately 18 months
largest mobile operators including MTN, regarding the remainder of the portfolio. of a collaborative negotiation process, DPI and
Airtel, Vodacom, Vodafone, and Orange. As its private equity partners agreed to sell Eaton
DPI and other shareholders began to plan an Eaton Towers’ geographic diversification, Towers to American Tower in December 2019,
exit together, they ran a dual-track process, which had been carefully structured by the with an estimated enterprise value of USD1.85
preparing the company for a possible IPO shareholders and management team, was a billion—making it one of the largest private
while simultaneously negotiating with strategic key selling point. As transactions of this scale equity exits in Africa to date.
investors. They had partially exited their holding were largely unprecedented in the continent,
in 2016 when American Tower purchased the team spent a significant amount of time
EMPEA Deal Book 2021 15EMPEA Deal Book 2021
The Investor: The Company:
Everstone Capital API Holdings
Asia Company: API Holdings
Fund Manager: Everstone Capital Asia Pte. Ltd. Website: www.ahwspl.com
Fund Name: Everstone Capital Partners III Industry / Sector: Digital health distribution platform
Fund Size: ~USD730 million Location: India
Total AUM: USD5 billion Founded in 2012, API Holdings is an Indian digital health
care platform with three business lines: offline medicine
Founded in 2006, the Everstone Group is a private distribution, an online B2B pharmaceutical marketplace
investment group in India and Southeast Asia, with a (Retail IO), and a B2C pharmaceutical marketplace
team of over 350 professionals across seven offices in (PharmEasy). As of October 2020, Ascent is the largest
Singapore, India, London, New York, and Mauritius. As of
e-pharmacy and the second largest offline distributor in
October 2020, the Everstone Group manages over USD5
India with access to over 20,000 pharmacies and 4,000
billion in assets across private equity, real estate, credit, distributors.
infrastructure, and venture capital.
Date of Investment: Amount: Participation / Stake:
March 2016 USD60.2 million 62.8%
Opportunity
In 2012, Siddharth Shah founded Ascent firm conducted a top-down analysis of the build the largest pharmaceutical distribution
Health and Wellness Solution—now one pharmaceutical distribution industry and marketplace in India.
of the subsidiaries of API Holdings—with a discovered that first-generation founders—
vision of consolidating India’s fragmented many of whom saw little interest from their
pharmaceutical distribution market and second or third generation—
creating a digital health care platform that dominated the competitive
could reach even the most remote corners landscape in India. With
of India. At the time, the industry was highly no clear succession plan,
fragmented with the top ten players each many of these owners were
having less than 2% market share. To achieve willing to sell their businesses
his goal, Shah approached Everstone Capital, at a discount. Everstone
which had a track record of executing buy-and- acquired a majority stake in
build strategies, in 2015. Ascent in March 2016 for
USD60.2 million. The firm
Everstone saw potential in Ascent, particularly aimed to provide growth
as the consolidation thesis had successfully capital for acquisitions,
played out in Western markets and was achieve economies of scale,
picking up steam in China. The investment and deploy technology to
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