Citadel Capital SAE, a private equity firm focused on the Middle East and Africa has received formal Board approval for a new ten-year, US$ 150 million financing facility from the United States Overseas Private Investment Corporation (OPIC), the US Government’s development finance institution. Of the total amount, $125 million is designated for investment in Egypt.
Citadel Capital SAE (CCAP.CA on the Egyptian Exchange), the leading private equity firm in the Middle East and Africa with US$ 8.7 billion in investments under control, received formal Board approval for a new ten-year, US$ 150 million (EGP 900 million) financing facility from the United States Overseas Private Investment Corporation (OPIC), the U.S. Government’s development finance institution. Of the total amount, $125 million is specifically designated for investment in Egypt.
The US$ 150 OPIC financing would, if added to the proceeds from the firm’s fully-subscribed US$ 175.6 million (EGP 1.05 billion) rights issue, give Citadel Capital a total of US$ 325 million (EGP 2.0 billion) of long-term capital. The firm also expects to add a further US$ 50 million to its cash balances through a series of small divestitures (rebalancing of its portfolio) over the coming months.
“Our balance sheet is now strong and liquid,” said Citadel Capital Chairman and Founder Ahmed Heikal. “These developments, coming as they do within a few weeks of each other, should put us in a robust financial position heading into the new year. As I have said before, this is opportunity capital: It gives us unprecedented flexibility to grow while simultaneously allowing us the freedom to explore new opportunities within our 19 Platform companies amid any further economic headwinds from still-unfolding regional events. We will, however, remain very cautious.”
“In order to support the economic and political transformation of the Arab Spring, MENA countries need investment in vital sectors – and that’s precisely the goal of this project,” said OPIC President and CEO Elizabeth Littlefield. “It addresses the shortage of credit in Egypt, where investment in important infrastructure sectors has been stymied by political uncertainty. We expect that this project, by catalyzing economic growth and creating jobs, will make an important contribution to the growth of democracy in Egypt.”
This marks the second time in just over one year that OPIC has approved financing for Citadel Capital and its investment opportunities. In July 2010, the firm announced that OPIC had approved a US$ 100 million financing facility for new investments alongside Citadel Capital and the firm’s Africa and MENA Joint Investment Funds (JIFs).
Citadel Capital reached a US$ 140 million first close on the JIFs, its first standard institutional funds, last fall with anchor investments from leading global financial institutions. The firm also continues to raise equity on a transaction-by-transaction basis through its flexible Opportunity-Specific Funds (OSF) model.
Added Hisham El-Khazindar, Managing Director and Co-Founder, “OPIC’s decision to extend finance is an endorsement not just of the fact that our investments remain firmly on the right side of macroeconomic trends, but of the added value Citadel Capital brings to the communities in which we do business. Citadel Capital’s investments are helping refine cleaner-burning fuels, ease road congestion and curb emissions by transporting goods by river and rail, tackle solid waste problems, and ensure food security, among other things.”
In addition to US$ 325 million raised from OPIC and the rights issue, Citadel Capital and its platform companies have raised a further US$ 319.3 million in equity and debt since January 2011 despite ongoing regional tensions.
The firm continues to enjoy the unqualified support of leading international financial institutions including the International Finance Corporation, the African Development Bank, the IFC African, Latin American and Caribbean Fund, Dutch development bank FMO, German development finance institution DEG, the European Investment Bank, France’s PROPARCO, Germany’s KfW Entwicklungsbank, Belgium’s BIO, Equity Bank of Kenya and the ICF Debt Pool, all of whom have joined leading regional co-investors in participating in Citadel Capital transactions this year.
Citadel Capital (CCAP.CA on the Egyptian Stock Exchange) is the leading private equity firm in the Middle East and Africa. Citadel Capital focuses on building regional platforms in select industries through acquisitions, turnarounds, and greenfields executed via Opportunity-Specific Funds. The firm’s 19 OSFs now control Platform Companies with investments worth more than US$ 8.7 billion in 15 countries spanning 15 industries, including mining, cement, transportation, food and energy. Since 2004, Citadel Capital has generated more than US$ 2.2 billion in cash returns to its co-investors and shareholders (on investments of US$ 650 million), more than any other private equity firm in the region. Citadel Capital is the largest private equity firm in Africa by PE assets under management (2006-2011, as ranked by Private Equity International).