Harith will acquire 46% of the capital of Mergence

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Harith will acquire 46% of the capital of Mergence

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Harith General Partners, a pan-African investor and developer of infrastructure projects across the continent, has agreed to acquire a significant stake (46%) in Mergence Investment Managers, an institutional fund manager with a strong track record of 19 years and capabilities in both areas. Private and public markets within SADC.

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Harith General Partners, a pan-African investor and developer of infrastructure projects across the continent, has agreed to acquire a significant stake (46%) in Mergence Investment Managers, an institutional fund manager with a strong track record of 19 years and capabilities in both areas. Private and public markets within SADC.


The transaction is subject to approval by the Competition Commission which is expected by the end of the year, allowing for a final closing of the transaction in January 2024.


This will also involve the creation of an independent women-led group that will own 5% of Mergence, strengthening women’s participation in the infrastructure investment sector, while further strengthening diversity within the team of management of Mergence.


The structuring of the shareholding of the women-led group in the transaction is based on a commitment shared by both entities to the imperatives of transformation of our society and the financial services sector, as well as the recognition of the importance diversity and inclusion in our economy.


“Harith’s acquisition of a majority stake in Mergence will have a force multiplier effect on the unique strengths, expertise and experience that these two formidable players in the financial sector possess,” said Sipho Makhubela, CEO of Harith .


“Our shared commitment and belief in the African continent’s ability to harness capital to unlock value for investors and societal stakeholders is a particularly pronounced feature of our partnership. It is this belief that will serve us well as we seek to build a formidable financial services player with diversified capabilities across public and private markets, capable of leveraging synergies and optimizing efficiencies,” he said. he added.


Founded in 2006, Harith is a pan-African investor and developer of infrastructure assets based in South Africa, managing approximately R22 billion in assets through the two funds it manages, namely PAIDF I and PAIDF II.


The assets managed by Harith are quality, market-leading assets with significant long-term growth potential.


Over the last 16 years, Harith has built a strong track record of creating value for its investors across key infrastructure sectors, namely Energy, Information and Communication Technology (ICT), water and sanitation, as well as transport.


Mergence, founded by Mr. Masimo Magerman, is a majority black-owned institutional fund manager, with a strong 19-year track record and capabilities in the SADC private and public markets.


The Company provides a range of investment management services to institutional clients, including pension funds and insurance companies, and has a geographic presence extending to Lesotho and Namibia.


Mergence is a leading asset management company with R37 billion in assets under management and aims to diversify into investments in clean energy, water, digital infrastructure, financial inclusion, food security and social infrastructure.


The combined expertise and benefits of collaboration will facilitate a wider range of offerings in private markets, including unlisted debt and equity products. The synergies between Harith and Mergence cover private market investments in sectors such as energy, ICT, transport, healthcare, water and sanitation and disruptive companies.


The shared strategic objective behind the acquisition transaction is to establish Mergence as a formidable, yet diversified, black-owned enterprise that becomes an African champion of financial services in both public and private markets.


The acquisition is also in line with Harith’s new strategic direction, as it provides an opportunity to diversify its sectoral focus areas. This fits well with Harith’s recent strategic pivot from a fund manager business model to one that will see Harith become a holding company with diversified, directly owned investments across a range of sectors on the continent and beyond.


Mergence brings considerable public markets expertise and experience to the transaction. As such, the benefits of Regulation 28 are also expected, enabling portfolio diversification and risk management of retirement funds, increased liquidity and ESG factors, as well as compliance with various African regulatory frameworks.


Sholto Dolamo, Managing Director of Mergence Investment Managers, said: “Infrastructure investments have been earmarked by the government as a catalyst for economic growth. This consolidation leverages Mergence’s footprint for expanded reach and new investment opportunities.


“We notably bring our experience in water investment, being the only investment manager with a stake via a public-private partnership in the only two private water concessions in South Africa,” he said. -he declares.

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