Sanari Capital, a South African private equity firm that focuses on mid-market growth companies in Sub-Saharan Africa, has marked the final close of its second investment vehicle. However, the firm fell short of the initial target by around 20%.
Sandton-headquartered PE firm Samantha Pokroy raised $80 million in a final close of its 3S Growth Fund, with 3S standing for Sustainable, Scalable, and Saleable. The fund is backed by a mix of institutional investors including Africa’s largest asset manager, Public Investment Corporation (PIC), and South Africa’s leading and largest provider of multi-manager investment portfolios and related investment services, Alexforbes Investments. The PIC manages capital for the Government Employees Pension Fund (GEPF), the largest pension fund in Africa.
However, the final close, which comes over two years after its first close at $65 million, is below the target fund size of $100 million. The other backers of the fund include the 27four Black Business Growth Fund, Telkom Retirement Fund, and the Motor Industry Retirement Funds.
The fund aims to back medium-sized growth companies from Africa, mainly from South Africa that have regional and global scalability and exposure. It would invest in businesses, with at least 3 years of operating history, and generating revenues. It is scouting for well-established businesses that are at an inflection point, driven by technology, innovation, and thematic or sectoral growth drivers. It is eyeing deals in sectors including the Internet of Things (IoT) and Tech, Schools or Edutech, Healthcare, Agribusiness, Medtech, Foodtech, among others. It invests in ticket sizes between $3 million and $14 million.
Last month, the PE firm made the fourth deployment from the 3S Growth Fund, acquiring a stake in Energenic Holdings, a South African manufacturer and distributor of energy generation products and related services across 32 African countries.
Other portfolio companies from the 3S Growth Fund include a school chain EduLife Group, microLiDAR sensor technology company LightWare LiDAR, and remote biometric digital authentication and automated on-boarding technology company Iidentifii. Its current portfolio companies have around 60% of revenues in hard currency, reflective of their export orientation and geographic expansion across Africa and the rest of the world, according to Sanari.
Other companies in its portfolio from its earlier outing- Sanari Growth Partners 12J Fund- include IoT platform Sensor Networks, ICT player Jaycor International, and geo-spatial data and solutions provider FernBridge Solutions.
