(Bloomberg) -- The Rohatyn Group said it will acquire South Africa’s Ethos Private Equity to help the US investment firm expand on the continent.
The purchase will help the New York-based company create a firm with close to $8 billion of assets under management, Stuart MacKenzie, chief executive officer at Ethos, said in an interview. Brait Plc, backed by South African tycoon Christo Wiese, in 2019 hired Ethos to manage its portfolio including UK apparel chain New Look and Virgin Active gyms. MacKenzie didn’t disclose financial details of the acquisition.
The deal will “essentially result in Ethos acting as the African arm for the Rohatyn group,” MacKenzie said. “Plans include raising private equity and credit funds, and potentially forestry, agricultural and infrastructure funds that will include investments in renewable energy assets on the continent.”
Africa’s need for funds to finance infrastructure projects is massive. While there are about $2.5 trillion of public works in the pipeline on the continent, many won’t be completed because of lack of funding among other constraints, according to McKinsey & Co. That’s where companies such as Rohatyn can help.
The purchase will give New York-based Rohatyn access to one of the fastest growing regions in the world, said Nicolas Rohatyn, who started the business in 2002.
Ethos, with offices in South Africa, Kenya and London, will continue to manage Brait’s portfolio. The advisory agreement between Brait and Ethos will be ceded to the Rohatyn group.
Brait shares were little changed in Johannesburg on Monday, with the company valued at 6 billion rand ($345 million). The Rohatyn and Ethos deal is still subject to regulatory approvals.
Buyout firm Ethos also took over the management of Ninety One Plc’s Africa private equity funds in 2020, with assets in North, East and Southern Africa.
--With assistance from Janice Kew.
(Add Brait shares in seventh paragraph)
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