PRIVATE EQUITY: More deals

Ethos Logo
FINANCIAL MAIL
14 MAY 2015

ETHOS, the blue-chip Illovo-based private equity firm, has announced its fourth transaction in five months. It has invested in Eaton Towers, a pan-African provider of shared telecom towers. Ethos is leading a consortium which includes two large US equity firms, Hamilton Lane and HarbourVest. The consortium is contributing US$150m in new equity. Ethos partner Ngalaah Chuphi says this is the first pan-African investment in Ethos Fund VI.

“The successful rollout of world-class mobile services is transformational for Africa. Investments of this type form the backbone of Africa’s renaissance.”

In January Ethos announced an investment in motor parts retailer and wholesaler AutoZone. In April it acquired two divisions of Nampak which were no longer considered core to the packaging giant: corrugated, which has been renamed Neopak, and tissue, renamed TwinCare. Ethos has overhauled this management. It has brought in two CEs from Kimberly-Clark, the multinational behind the Kleenex brand. Kevin Clayton, the group’s MD for Middle East and Africa, will be MD of Neopak. Garth Towell, who was MD of Kimberly-Clark sub-Saharan Africa, is the new CE of TwinCare.

Ethos partner Shaun Zagnoev says these appointments are the first step in Ethos’s stated objective to revitalise these businesses through enhanced investment in resources, leadership capacity and strategy.

Zagnoev says Ethos identified both investment opportunities in 2014 and pursued them, given its confidence in the business fundamentals. Ethos has a value-add team, headed by Richard Fienberg, which helps on the operational side of the businesses.

Ethos has made 102 investments in its 31-year history and has exited from 88. Its current fund, Fund VI, has R7,9bn of committed capital, and includes investments in Waco International and parcel delivery group RTT.