In a significant shake-up of South Africa’s infrastructure investment landscape, a consortium led by Harith General Partners has sealed a R6.5 billion acquisition of assets from the Pan African Infrastructure Development Fund (PAIDF1). This deal includes stakes in notable companies such as Vumatel, Dark Fibre Africa (DFA), and Lanseria International Airport.
Exit Opportunity for Investors
The transaction allows PAIDF1 investors, including heavyweights like the Government Employees Pension Fund, Absa, and Old Mutual, to exit the fund. The sale comprises a 15.3% share of Community Investment Venture Holdings (CIVH), which owns key fibre infrastructure companies Vumatel and DFA, along with other tech players like Sigfox South Africa and Britelink MCT.
Vumatel, a prominent player in fibre connectivity, also has a substantial shareholding in Herotel, a closed-access fibre network operator. Additionally, CIVH owns Maziv, a company established to consolidate its fibre assets in preparation for a partnership with Vodacom that was later blocked by regulatory authorities.
The Vodacom Deal That Wasn’t
Vodacom had initially proposed to acquire a 30% to 40% stake in CIVH for at least R13.2 billion. This offer included R6 billion in cash and fibre assets valued at R4.2 billion, along with a secondary purchase worth an estimated R3 billion. However, the Competition Tribunal halted the deal, citing concerns over reduced competition in the fibre sector.
Vodacom’s involvement could have fast-tracked Vumatel’s plans to bring fibre networks to South African townships. Without this investment, CIVH has warned that its expansion timeline will significantly lengthen—from three to four years to nearly a decade.
The Importance of Harith’s Acquisition
Harith InfraCo, through its acquisition, now owns key PAIDF1 assets, solidifying its position as a major player in African infrastructure investments. This deal follows its successful 2022 divestment from subsea cable operator MainOne, showcasing Harith’s ability to navigate a challenging private equity environment.
“Despite the sluggish fundraising climate, this acquisition underscores Harith’s commitment to developing African infrastructure,” said Sipho Makhubela, CEO of Harith General Partners.
Other Strategic Assets
Beyond fibre infrastructure, PAIDF1’s portfolio includes a 37.92% stake in Anergi, which operates Johannesburg’s Kelvin Power Station, and a 37.5% share in Lanseria Holdings. Lanseria International Airport, South Africa’s only privately-owned international airport and the second largest in Gauteng, remains a pivotal asset.
Future Implications
The Vumatel and Lanseria deal signifies a broader trend in South Africa’s infrastructure investment landscape. It highlights both opportunities and challenges, from regulatory hurdles to the urgency of connecting underserved communities.
As the dust settles, this landmark transaction could pave the way for new developments in telecommunications and transportation, while also signalling a potential revival in private equity activity within the region.
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