New Delhi, Sept. 8 -- Helios Investment Partners, one of the largest private equity firms in Africa that manages assets worth over $3 billion, has agreed to acquire data centre assets of Egyptian telecommunications services provider Telecom Egypt.
The London-headquartered PE firm, which has offices across Nairobi, Paris, and Lagos, will acquire a subsidiary that will own the Regional Data Hub (RDH) data centre assets of Telecom Egypt. Helios will buy a stake ranging between 75% and 80% for approximately $177 million. Telecom Egypt will retain a 20-25% stake.
The deal values the RDH on a debt-free, cash-free basis at $230 million, which could reach $260 million subject to the achievement of certain performance indicators, Helios said in a press release on Monday.
The RDH is a multi-phase data centre campus in Cairo. The first phase was launched in 2021 and provides approximately 2.5 MW of IT load. It reached full utilization within a year, and achieved multiple Uptime Institute Tier III certifications. The second phase is designed for approximately 4.6 MW of IT load.
It is fully owned by Telecom Egypt, which offers services ranging from fixed and mobile voice, high-speed internet, data centre facilities, and cloud computing.
The deal completion will be subject to the agreement and execution of the terms and conditions of definitive agreements, the completion of the restructuring of the RDH within a subsidiary of Telecom Egypt, and the satisfaction of a number of conditions precedent to the transaction, Helios said. Telecom Egypt's board has approved the transaction.
Helios will likely deploy capital from its latest fund, the Helios Investors V, which has a target corpus of $750 million. The PE firm aims to invest Fund V in 10-12 companies, with an average ticket size of $70-80 million (excluding co-investment amounts).
The fund's focus sectors include digital infrastructure (data centres, fibre networks and telecom towers), financial services and financial technology (banktech, payments, and financial management software), tech-enabled business services (cloud services, regtech, healthtech and logistics-tech), and consumer non-discretionary (food and beverage, healthcare, and education).
The PE firm is also raising the $400-million climate-linked fund CLEAR, which stands for Climate, Energy, Adaptation and Resilience Fund.
Helios, co-led by Tope Lawani and Babatunde Soyoye, has raised $3.8 billion in private equity, credit, and co-investment funds, with investment across 30 African countries since establishing in 2004.
As for its previous outing, Helios had secured commitments worth only $355 million for its Helios Investors IV, as against a target of as much as $1.4 billion. In fact, Helios was initially eyeing $1.25 billion for Helios Investors IV, aiming to better its record of $1.1 billion for its third fund.
Helios Fund III had surpassed its original target size of $1 billion, and was the biggest such PE fund for Africa. The PE firm had raised $908 million for its second fund in 2009, three years after raising $304 million for its maiden fund.
So far, Helios has exited 13 investments and has a current portfolio of 22 companies. The portfolio includes Kenyan property developer Acorn Group, upstream oil company Africa Oil, solar power distribution company Zola Electric, medtech company T2S Group, media and telecom company Wananchi Group, and fuel and lubricants player OVH Energy. Its recent deals include acquisition of a 49% stake in Egyptian frozen food manufacturer and exporter Raya Foods for $40 million.
In a key exit last year, the pan-African PE firm sold its stake in Solevo, a leading specialty chemicals distribution platform to a group of investors led by Development Partners International (DPI, a PE firm focused on Africa. The minority co-investors were South Suez and the German development finance institution DEG.
The other specialized funds raised by the investment firm include Helios Digital Ventures, Helios Sports and Entertainment, Helios Seven Rivers Fund, and Helios Energy Transition Infrastructure.
Published by HT Digital Content Services with permission from VC Circle.