AFRICA – Fairfax Africa Holdings Corporation, a Canada-based investment company, has reached an agreement to merge with Helios Holdings limited, the Africa-focused private equity firm to create a truly pan-African investment firm.

Fairfax said in a statement that when the deal is finalised, Fairfax Africa Holdings Corporation will be renamed Helios Fairfax Partners Corporation.

The company will remain listed on the Toronto Stock Exchange and the Helios co-founders Tope Lawani and Babatunde Soyoye will be joint Chief Executives of the new company.

The terms of the deal will also require Helios to exchange 45.6% of equity and voting interest in the new company.

Helios will contribute its performance and management fees through its present and future holdings under the Helios funds, thereby making Helios Fairfax Partners Corporation one of the biggest Africa-focused asset management firms by complementing the experiences and funds of both companies under one umbrella.

The new company will also have a larger capital base for diversified investment inflows to the continent through years of experience in third-party investment management operations and the support of longer-term institutional shareholders.

The main objectives of this deal are summarized as:

  • Helios Fairfax Partners Corporation to become the leading pan-Africa focused listed alternative asset manager with unique capabilities to invest across the continent
  • Creates a diversified investment platform combining best in class third-party investment management capabilities with the strength of long-term shareholders in a permanent capital vehicle
  • Provides an enlarged capital base, increasing capacity to invest as well as to launch additional and differentiated Africa focused asset management strategies and initiatives
  • Reinforces the parties’ shared long-term commitment to be a consistent and trusted provider of capital to growing African businesses across market cycles

In his remarks, Tope Lawani disclosed that the deal will offer emerging market investors the opportunity to gain exposure to the continent through their portfolio.

“We take a long-term view on our investments, and many have proved resilient even in this pandemic with a number of our investments in sectors such as telecommunications, payments, and food,” Lawani said.

He added that the transaction will offer Helios access to permanent capital from equity markets that can be used to accelerate its product and growth strategy.

Helios, which was founded in 2004, has raised third party private capital for the past 15 years investing in Africa companies including First City Monument Bank (exiting in 2013), Interswitch, Vivo Energy and Helios Towers Plc.

Fairfax was founded by Canadian Billionaire Prem Watsa and will own 45.6% of the Helios Fairfax Partners Corporation. Before the merger, Helios was raising US$1.25 billion for its Africa focused fund and had landed a commitment of US$100 million from the U.K’s CDC Group.

Liked this article? Subscribe to DealStreet Africa News, our regular email newsletter with the latest news, deals and insights from Africa’s business, economy and more. SUBSCRIBE HERE