Affirma Capital, previously known as Standard Chartered Private Equity (SCPE), has taken the lead in a noteworthy single-asset continuation deal in Africa, involving a substantial $145 million investment into Copperbelt Energy Corporation (CEC). The private equity firm initially invested in CEC in March 2014 through a structured equity investment supporting the controlling shareholder. By March 2018, Affirma Capital converted its investment into a 34.64% shareholding in CEC.
CEC operates as an independent power transmission and distribution company in Zambia, listed on the Lusaka Securities Exchange. Its primary focus is on distributing power to the majority of mines in Zambia’s Copperbelt Province and the adjoining Katanga Province in the Democratic Republic of Congo (DRC). Additionally, CEC transmits power for ZESCO Limited, the Zambian national utility, and engages in electricity trading within the Southern African Development Community (SADC) as part of the Southern African Power Pool (SAPP). The company is actively investing in renewable energy, boasting a 34MW operating solar plant and another 60MW plant set to be commissioned in January 2024.
For this transaction, Affirma Capital collaborates with Norfund and Kommunal Landspensjonskasse gjensidig forsikringsselskap (KLP) to provide financing. Norfund, the Norwegian Investment Fund for Developing Countries, and KLP, the largest pension fund in Norway, join forces to support the deal. Standard Bank of South Africa Limited contributes $50 million in acquisition financing.
Since its 2014 investment, Affirma Capital has led several initiatives to strengthen CEC, including a demerger from its subsidiary CEC Africa in 2016 and the sale of its stake in CEC Liquid. Recent efforts have focused on developing solar projects and enhancing the power trading business. The transformation also involved the insertion of a high-performing local management team and robust governance systems, fostering systematic decision-making and strategic development.
With this transaction, Affirma Capital, Norfund, and KLP aim to see CEC expand its investments in transmission infrastructure and renewable energy in the future. CEC stands out as one of Affirma Capital’s most successful investments, and this continuation transaction underscores the firm’s long-term commitment to building on CEC’s success. Affirma Capital aims to further strengthen CEC’s position in the Africa decarbonization program, increase renewable capacity, expand power access in Zambia and the DRC, and contribute to the liberalization and evolution of the electricity market in Southern Africa.
Ronald Tamale, Founding Partner and Head of sub-Saharan Africa at Affirma Capital, expressed enthusiasm about the partnership with Norfund and KLP, emphasizing their bullish outlook on CEC. He looks forward to continuing the journey with existing shareholders, management, and the Board to establish CEC as a leading energy company in Africa. This transaction exemplifies how private equity firms can collaborate with diverse investors to become long-term owners of businesses in Africa. Affirma Capital, established in 2019 through the spin-off of Standard Chartered Private Equity from Standard Chartered Bank, boasts a 20-year track record of successful investments across Asia, Africa, and the Middle East, managing over USD 3 billion in assets.
