Leading private-equity investor The Abraaj Group (www.abraaj.com) has exited its investment in Fibrex (www.fibrex.co.ao), its first exit in Angola. The announcement today (4 Aug) did not give details of the price or the buyer
Fibrex manufactures high-density polyethylene (HDPE) and other low-pressure plastic pipe products used in the construction industry. Abraaj invested through one of its funds in 2007 and has given operational support and since then, production volume has grown by 70%. Abraaj has supported upgrading the energy-supply infrastructure, improved governance, accounting and reporting standards, and increased environmental efficiency at Fibrex.
When Fibrex started in 1966, it was making woven bags to transport agricultural materials and fertilizers. It evolved into products such as PVC and HDPE pipes for the construction industry and it became the first company in Angola devoted to manufacturing plastic pipes and fittings. It has grown since into the domestic market leader.
In 2010 Fibrex secured ISO 9001 certification for quality management. The production facilities were further upgraded to recycle by-products of production, including plastic sawdust and fragments, and to reduce noise.
Abraaj’s also worked with Fibrex and Angola’s labour and trade unions to offer counselling, testing and adequate medical care to employees for HIV treatment.
The announcement quotes Davinder Sikand, Partner and Head of Sub-Saharan Africa at The Abraaj Group: “At Abraaj we have an unrivaled history of pioneering the private equity industry in Africa, where our strong on-the-ground teams penetrate relatively untapped markets and gain access to opportunities that often pass under the radar of investors that are not as well entrenched in these markets.
“We initiated our investment in Fibrex based on Angola’s strong macroeconomic conditions. The country, focused on rehabilitating its national infrastructure, showed rapid GDP growth and demonstrated significant demand for quality construction-related material and products which has helped Fibrex attain a market leading position in the country.”
Sandeep Khanna, Managing Director at The Abraaj Group: “Fibrex was not only well positioned to capitalize on the wide-scale infrastructure development of Angola, but also presented impressive growth rates sustained by its ability to retain its market-leading position despite increasing competition from new foreign entrants.
“Fibrex remains in a strong position today to capture the continued growth of the construction industry, as Angolans and the African continent more broadly seek to address their infrastructure needs. This successful experience in Angola has strengthened our confidence in the country’s investment opportunities, increased our appetite for Angolan businesses, and boosted our search for local partner companies.”
The Abraaj Group currently manages USD $7.5 billion across more than 20 sector and country-specific funds, encompassing private equity and real estate investments. Funds managed by the Group currently have holdings in over 140 partner companies across 10 sectors including consumer, energy, financials, healthcare and utilities. It operates in the growth markets of Africa, Latin America, the Middle East, South Asia, South East Asia, Turkey and Central Asia and employs over 300 people across over 25 offices in 6 regions, including hubs in Istanbul, Mexico City, Dubai, Mumbai, Nairobi and Singapore.
It has been investing in Africa for the past 29 years, deploying $2.6bn across 80 investments.