Amethis Finance has reached the first close of its maiden private equity and debt fund at $290million.
The fund is anchored by La Compagnie Benjamin de Rothschild (CBR) and is targeting $500million at final close. Of this, $300million has been earmarked for private equity deals, while the rest will go into debt investments.
The first close has brought in $140million for equity investments from 18 private investors, who are mainly based in the US and Europe. The fundraising has been bolstered by CBR’s relationships with banks, corporates and family offices.
The fund manager is expecting another $40million from three institutional investors by the end of March 2013. The fund has also received a 13-year $150million credit financing line from the Overseas Private Investment Corporation (OPIC), for debt investments.
Amethis is expected to reach its final close by 2013 year-end. Launched in January 2012, the vehicle offers limited partnerships and is structured as a Luxembourg Sicar.
Amethis was created by Luc Rigouzzo and Laurent Demey, who are both former Proparco executives. Rigouzzo was previously chief executive officer (CEO) at the French development finance institution, while Demey was chief investment officer and then deputy CEO. They are now both managing partners at Amethis.
The Amethis fund has been modelled after the traditional developmental finance strategy of providing a combination of equity, mezzanine and debt financing to companies. The fund manager expects the model to provide stable and predictable cash flows from debt investments, while offering an upside on the equity end of the business.
“LPs have access to the upside brought by the private equity activity while benefiting from stable and rapid cash flows thanks to the debt, which acts as a buffer and brings in an additional IRR,” said Demey.
The fund will seek to tap Africa’s burgeoning growth, particularly in countries such as Kenya, Ghana, Ivory Coast, Nigeria, Morocco, Tunisia and Uganda. The fund manager also plans to open regional offices to strengthen its local foothold.
The investor is primarily looking for deals in the management team’s core sectors of expertise, which include financial services, energy, infrastructure, consumer and agribusiness. Amethis has already closed its first deal, sealing an undisclosed transaction in December 2012.