Ninety One, the South African asset manager has unveiled a $600 million fund tagged “The Ninety One SA Recovery Fund”, in partnership with Ethos Private Equity.
The Ninety One SA Recovery fund will support investments in South African businesses that have been affected by the coronavirus pandemic.
With a focus on the urgency of the economic situation in SA, Ninety One is targeting a first close of the fund in July 2020. Ninety One will be targeting a fund size of $600 million (R10bn), with funding raised via two closes from South African institutional investors.
The fund aims to achieve a positive impact with attractive returns via a clear set of investment outcomes. Priorities for the fund are to protect SA productive capacity during the next 24 months, preserve jobs and protect permanent loss of equity value.
The fund will consist of a concentrated portfolio with an appropriate mix of senior and subordinated debt, preferred equity, listed equity and private equity with a deployment time horizon of 18 to 36 months.
Ninety One has had initial talks with institutional investors across the private and public sector, throughout May, to gauge their interest. According to Moola, there is recognition within the long-term savings industry that it needs to be part of the solution as SA responds to the impact of Covid-19 on the economy.
Hendrik du Toit, Founder, and CEO of Ninety One said: “The lockdown, while necessary to protect the nation’s health, has been akin to putting the economy into an induced coma. South Africa faces a once-in-a-generation economic challenge.
“The SA Recovery Fund is a market-led, impact initiative to mitigate the negative economic impact of the COVID-19 pandemic while seeking a commercial return.
“With this fund, we would like to support quality businesses and protect the nation’s productive capacity, which will in turn preserve thousands of jobs and support the South African tax base.”
Stuart Mackenzie, Chief Executive of Ethos Private Equity said: “The Ninety One SA Recovery Fund provides Ethos with a unique opportunity to partner with Ninety One on a critical funding initiative at an important moment for our nation.
“Our experience and institutional capabilities in private equity ideally position us to play a value-adding role in the execution of the Ninety One SA Recovery Fund’s investment strategy.”
