Mr. Karim Sadek gave a very insightful presentation at
Mindspeak which touched on Citadel Capital activities in this region.
In his candid presentation ‘the role of private sector in
accelerating development’ he opened Citadel Capital up to the public. This is
the story of Citadel Capital in figures
- It has $ 9.5 Billion in
investments under control as of end year 2011
- $ 940 Million in Principal
investments
- Operates in 15 industries: from
Agriculture, Financial Services to energy distribution
- Has 19 specific funds as per end
year 2011
Sadek also espoused Citadel capital track record and their
business model. However, what was most insightful we’re his observations on
African investment climate. From his position, managing a capital fund, he was
of the view that of late Africa has been attracting substantial interest from
the rest of the world. However, writing of Cheques for Sub Saharan Africa
outside oil and gas is still lacking.
Egypt before and
after the revolution
Since Citadel is head office is in Cairo we got a business
101 on Egypt. Kenya Association of Manufacturers (KAM) has been in the news
complaining of imports from Egypt which are substantially cheaper than Kenyan
products because of power/energy subsidies. Well the good news for KAM is the
regime of subsidies is coming to an end in Egypt.
The other interesting piece of information from Sadek was
insights before the Arab spring. Citadel Capital was two weeks to finalizing a
deal for a stake in Egyptian Refining Company before lady liberation came
calling. Also, the change in attitudes and perceptions in Egypt, this days
young people have no respect for authority. The other interesting insight was
the East Africa compared to Egypt had better industrial relations. Egypt is now
in the initial process of coming up with an independent workers union.
Citadel’s interest in
Kenya
Citadel interest in Kenya came through an opportunity that
presented itself in Rift Valley Railways [RVR] which won a 25 year concession on
Kenya-Uganda Railway. After the turbulent times RVR has been through it seems
with the entry of citadel capital the century old railway is up to some good
times ahead.
The Preposition
Citadel capital together with its partners came up with a $
300 Million preposition to turn around the railway in the next five years.
Under the three point turn around based on;
- Upgrade of operationn
- Rehabilitation of existing assets
- Additional of new assets [2014 onwards
Some of the Partners in this Turn around Endeavour
Prominent names stand out in this deal which means this is a success story in the making. These institutions underwriting the success of our railway are;
- African Development Bank
- KfW Entwicklungsbank (Germany)
- International Finance Corporation
- FMO (Dutch)
- Equity Bank (Kenya)
- ICF Debt Pool
- BIO (Belgium)
This here might be the next success story in
Kenya if Citadel Capital can hack it.