The Financial Services Board (FSB) has finally reached the implementation phase of the Solvency Assessment and Management (SAM) framework and insurers are expected to be ready to comply with their SAM obligations. So far, discussions around the implications of SAM have centered largely around insurers, with little focus on other significant industry players, such as private investment funds in which insurers may invest their capital.
We are ‘bottom-up’ investors who pay more attention to valuations than to macroeconomic forecasts. We do extensive research to calculate what we believe is intrinsic value (the underlying worth or price you would pay for the business), and buy assets when the discount between this intrinsic value and the market price is sufficiently large to limit downside risk.
Historically, international investors investing in Africa through Mauritius had structured their funds using Global Business Companies. However, since the implementation of the Limited Partnerships Act 2011 in Mauritius, increasing numbers of funds have been structured as Limited Liability Partnerships. More than 25 funds structured as Mauritius partnerships are now registered in the jurisdiction.
Low gross domestic product growth, an unpredictable currency and rising political tensions have all contributed to a particularly uncertain economic outlook for South Africa, exacerbating an already tough investment landscape.
While the weather phenomenon appears to have passed, El Niño will continue to impact food security, food prices and humanitarian needs well into 2017, according to a new Bright Africa special report from African investment specialists RisCura.
Fintech in Africa, as elsewhere in the world, is big business. Investment is flooding into startups providing innovative ways of offering financial services. Startups in the fintech space took on almost 30% of the total funding raised by African tech businesses in 2015. Globally, growth in the sector is huge, with $19.1bn invested globally last year, a 106% jump from 2014.
Infrastructure models require a return on investment that is secure and a political environment that is stable. The quality of governance and the legal enforcement of contracts vary widely across African jurisdictions and like all emerging markets, a high level of due diligence has to be carried out. However, with a population of 1.2 billion and increasing levels of education and aspiration, there is a huge demand for improved living standards across Africa. This brings with it the need for reliable power supply, clean water and effective waste water treatment, new roads, railways and ports, as well as telecommunication facilities (to name but a few).
Robert Hamill (left), Partner & Sam Webster (right), Senior Associate, Mayer Brown, say that this 2016 will be critical for M&A; activity in the energy sector following the turbulence of 2015
The World Bank released the Africa’s Pulse report on April 11, in which the multilateral organisation outlined salient economic vulnerabilities and provided strategies for unlocking inclusive, sustainable growth. The report focuses primarily on the economic growth and policy challenges presented by the terms of trade shock posed by the commodity price slump. The large shock to the terms of trade undermined the strength of local currency units (which added greatly to consumer price inflation pressures and inflated the real debt burden), and weakened policy buffers. The resultant increase in external fragility weakened fiscal positions, set off a flurry of credit rating downgrades and increased the probability of balance of payments crises.
The most significant development in the financial services industry in the US and the UK in recent times has been the emergence of robo-advisors – internet-based systems which, through a series of questions, lead investors to an appropriate mix of investments suited to their personal circumstances.
Recent US airstrikes in Libya and Tunisia underline a growing concern that ISIS is deepening its reach across northern Africa. Increasingly, Libya is becoming the main target of the group, but why? And what are the national and regional consequences?
SAVCA, the South African Private Equity and Venture Capital Association, held a successful annual conference at Spier Wine Estate, Stellenbosch, on 17 and 18 February 2016. Close on 400 delegates came together to navel-gaze both the South African and broader African private equity environment, and it is worthwhile trying to tease out some themes and trends for the year ahead.
