Private investment firm Kianga Capital has opened in Hong Kong, with a view to raising money for structured foreign direct investment into Africa and Latin America.
The company, which also has an office in South Africa, set up in late September in Hong Kong and is building relationships with institutional and private investors. It is keen to leverage the Africa-China commodity-supply links, which were analysed in detail at the joint AsianInvestor/FinanceAsia inaugural Africa investment summit in late September.
Kianga, which means "burst of sunshine" in Swahili, aims to establish long-term relationships to leverage on expertise in the Hong Kong financial services arena. The first relationship it has struck in Hong Kong is with financial services firm Well & Well JP Capital Group.
“Through WWJP we are able to identify and investigate viable opportunities to partner Asia-based PE and infrastructure project funders,” says Neo Lawrence Mabulu, chief executive of Kianga.
The Hong Kong office comprises Mabulu, chief financial officer Themba Tshepo Madi and chief operating officer Teboho Price Monahadi, along with an administrative member of staff.
Several companies work with Kianga across Africa on a turnkey basis, where they operate a business on Kianga’s behalf. The firm was set up as a capital-raising tool for projects in the infrastructure, mining, energy, power, telecoms and manufacturing sectors. It offers structured finance and corporate finance and is looking at establishing M&A advisory capabilities.
The firm is currently looking at single projects, with a view to raising a fund, closing it within 18-24 months and investing it in projects of three-to-five-year duration. The aim is to put infrastructure in place first, after which energy and mining facilities can be set up through further investment, says Mabulu. He did not specify the size of fund Kianga wants to raise.
Kianga is looking largely to Asia as a source of capital, particularly targeting Chinese, Japanese and South Koreans as potential funders. Infrastructure and energy are two areas that Asian investors are comfortable lending to and in which they have technical know-how, adds Mabulu.
Asked how concerned potential investors are about, say, South Africa given the major recent miners’ strike, Madi argues that Africa is a safe investment destination.
“We need not look further than China’s bilateral agreements with several African countries over the last decade,” he adds. “Such agreements help create a conducive and viable investment climate. China has for the past decade taken the lead in directing funding into Africa.”
Madi admits it is very important for investors that there’s a level of comfort provided over the political environment by bilateral agreements.
Monahadi says due diligence is done on the legal and political framework of each significant investment to ensure it has the right backing and government support and that the proper guarantees or levels of local confidence are there.