Standard Chartered private equity initiates ‘power Africa’ partnership with USD57 million investment in Copperbelt Energy Corporation
Lusaka, Zambia – Tues 11 March 2014: Standard Chartered’s Private Equity Africa division (“SCPE”) announced its first investment in Africa’s developing power sector. SCPE has invested USD57 million into Zambian Energy Corporation (“ZamEn”), the controlling shareholder of Copperbelt Energy Corporation Plc (“CEC Plc” or the “Company”). This structured equity investment equates to an effective 25.8% equity stake in CEC Plc.
CEC Plc is an independent power transmission and distribution company in Zambia, and is listed on the Lusaka Stock Exchange. The Company’s core business consists of distributing power to the mines operating in Zambia’s Copperbelt, and transmitting power for ZESCO Limited, the Zambian national utility. CEC Plc recently established CEC Africa (“CECA”), a Mauritius-domiciled platform company as its vehicle for power infrastructure investments in Africa, outside of Zambia. CECA has acquired two operating assets in Nigeria through the recently concluded power sector privatisation programme, and has a rich pipeline of development power assets in Zambia, Namibia and Sierra Leone.
Standard Chartered’s investment supports CECA’s pan-African expansion strategy, and is the first investment within the Bank’s USD2billion commitment to ‘Power Africa’, a public-private sector partnership launched by US President Obama on his trip to Africa last year. In Nigeria, CECA has already acquired a controlling interest in the Abuja Electricity Distribution Company and a 20% stake in the 600MW Shiroro hydro plant. Nigeria’s power privatisation initiative is expected to increase system-wide generation capacity and connectivity, while reducing costs and technical losses, thereby facilitating a self-sustaining power sector which supports Nigeria’s economic growth.
Michael Tarney, Managing Director for Corporate Development at CEC Plc commented, “Our success in Zambia has given us the experience and capability to generate, transmit and distribute power in other African markets. We are excited about our two strategic acquisitions in Nigeria. Over time, we expect that the Abuja Disco will deliver consistent and reliable power to more than 750,000 customers in Nigeria. Capital investment of more than USD180 million is anticipated in the business plan covering our distribution operations in Abuja, Niger, Kogi and Nasarawa States. With Standard Chartered’s valuable support, we look forward to building significant business scale and delivering sustainable benefits to Nigeria’s economy.”
Diana Layfield, CEO Africa stated, “This is our first contribution towards the Bank’s USD2 billion commitment to ‘Power Africa’ – a public-private partnership which is set to double Sub Saharan Africa’s access to electricity over the next 5 years. ‘Power Africa’ enables us to live our brand promise and be Here for good, making a tangible difference in the lives of individuals. By financing the real economy, investing in the continent‘s infrastructure and supporting trade and its people, banks can really help transform Africa’s prospects.”
Ronald Tamale, Director within Standard Chartered’s Africa Private Equity Division, added, “CEC is another African success story, and is emerging as an important Standard Chartered client. CEC has a strong management team and inspiring growth potential, extending commercial and economic benefit to multiple countries across the continent. Private Equity is an increasingly useful tool in supporting the growth of African companies who have achieved local success, but now need structured capital and specialist expertise to develop a profitable, pan-African presence.” Mr. Tamale
Andrew Okai, Chief Executive Officer at Standard Chartered Bank Zambia Plc commented, “Africa has experienced positive growth over the past decade, Zambia inclusive. To support this growth, investment in our infrastructure is vital. I would like to commend the Government of Zambia on the major infrastructure initiatives already taking place to improve the country’s road and rail network, energy, air capacity and internet connectivity. As one of our fastest-growing markets in Africa, this historic deal with CEC demonstrates that Standard Chartered is committed to the development of Zambia’s energy infrastructure, which will deepen and further enhance the country’s business environment and positive growth trajectory.”
According to the World Bank, Africa’s total infrastructure spending need is USD93 billion per annum. Of that, Africa should be spending USD41 billion on power, installing 7,000 MW per annum of generation capacity, just to keep up with electricity demand. The ‘Power Africa’ partnership will provide USD7 billion of US financing support and an initial USD9 billion of private sector commitments for power generation projects – ultimately delivering 10,000 megawatts of new electricity generation across 6 countries, reaching 20 million individuals in 5 years. Standard Chartered has made the largest private sector contribution to the partnership thus far.
ENDS
For further information, please contact:
| Copperbelt Energy Corporation: Chama Nsabika-Kalima – Senior Manager Corporate Communication Mobile: +260 966 792 922 Email: [email protected] |
Standard Chartered Bank: Lauren Callie – Head of Business Communications, Africa Mobile: +27 (0)82 894 558 Email: [email protected] |
NOTES FOR EDITORS:
About CEC
The Copperbelt Energy Corporation PLC (CEC) is an independent power generation, transmission and distribution company, with interests in closely linked businesses in Zambia and the African region, including optic fibre based telecommunications. A member of the Southern African Power Pool and listed on the Lusaka Stock Exchange, CEC has a deep insight into the mining industry, enabling it to provide quality electricity and other power products and services to the majority of the mines in Zambia for over 50 years. CEC is well positioned as a developer of energy infrastructure in Africa and is respected in the region for its skills in designing and operating transmission systems.
The Company owns and operates over 1,000 kilometres of high voltage transmission lines and 41 substations covering all towns in Zambia’s mineral-rich region of the Copperbelt, and owns the Zambian portion of the electricity interconnector with the Democratic Republic of Congo, which enables transportation of power within the Southern African region. CEC accounts for over 50% of Zambia’s power consumption.
CEC Africa Investments Limited – a pan-African Power Developer
A subsidiary of CEC Plc, CEC Africa is an investments holding company established to develop, finance and operate power infrastructure projects across sub-Saharan Africa. A pan-African power assets developer, CEC Africa provides access to an African power platform with attractive assets across sub-Saharan Africa and has a strong pipeline of both green field and brown field power projects in development across Africa. Riding on the opportunity presented by Africa’s significant infrastructure deficit and growing investment interest for infrastructure in Africa, CEC Africa offers an attractive investment vehicle in Africa’s energy infrastructure sector.
Please visit www.cecinvestor.com for more information. You can follow us on Facebook at www.facebook.com/cecinvestor and on Twitter @cecinvestor.
About Standard Chartered Private Equity
SCPE is the private equity arm of Standard Chartered. SCPE invests in companies in need of expansion capital or acquisition finance, and in management buy-outs. SCPE focuses on companies whose principal operations and management are located in Asia, Africa or the Middle East. It is an active partner that provides board-level strategic advice and access to the international network of Standard Chartered. Operating out of Johannesburg and Lagos, SCPE Africa has investments of about $650m in Nigeria, Tanzania, South Africa, and Botswana.
Standard Chartered – leading the way in Asia, Africa and the Middle East
Standard Chartered is a leading international banking group. It has operated for over 150 years in some of the world’s most dynamic markets and earns around 90 per cent of its income and profits in Asia, Africa and the Middle East. This geographic focus and commitment to developing deep relationships with clients and customers has driven the Bank’s growth in recent years. Standard Chartered PLC is listed on the London and Hong Kong stock exchanges as well as the Bombay and National Stock Exchanges in India.
With 1,700 offices in 70 markets, the Group offers exciting and challenging international career opportunities for 87,000 staff. It is committed to building a sustainable business over the long term and is trusted worldwide for upholding high standards of corporate governance, social responsibility, environmental protection and employee diversity. Standard Chartered’s heritage and values are expressed in its brand promise, ‘Here for good’.
In Africa the Bank has operated for over 150 years and currently covers 37 markets on the continent – 15 on a full presence basis, and an additional 22 on a transaction basis following its clients. Given its unique footprint, Standard Chartered is ideally positioned to facilitate and support valuable trade and investment corridors intra-Africa, and between Africa and the rest of the world. In October 2012, Standard Chartered reiterated its commitment to Africa by confirming the Group will be investing another USD100 million on 110 new branches over the next 3 years, as well as making substantial hires in both their Wholesale and Consumer Banking businesses – 900 sales staff will be added to Consumer Banking by 2015. The Group aims to maintain the 16% Compounded Average Growth Rate it has delivered over the last 5 years.
For further information please visit https://www.sc.com/en. Follow Standard Chartered at https://www.facebook.com/standardchartered and on Twitter @StanChart.
