African Infrastructure Investment Managers (AIIM) has sold investments in three privately concessioned toll roads in Southern Africa, the private equity fund manager said on Wednesday.
Acting as the manager of the South Africa Infrastructure Fund (SAIF), AIIM successfully concluded the transaction on July 4.
This sale represented the largest private equity realisation for toll road infrastructure in Africa to date.
Each of the toll roads had in excess of ten years’ operating history and, together, these roads covered a total of 1 364 km on South Africa's key transport corridors, extending from Gauteng province to Maputo, in Mozambique, and from the Botswana border to KwaZulu-Natal respectively.
During the SAIF’s involvement, capital expenditure in excess of R13-billion was deployed for rehabilitation and expansion to maintain service standards and increase road safety for road users.
The toll road concessions also supported a comprehensive range of socioeconomic and education programmes along the concession corridors.
“This sale transaction demonstrates the increasing development of the African infrastructure sector and addresses the concern investors may have around the ability to dispose of infrastructure assets,” said AIIM CEO Jurie Swart.
He added that interest from international investors was testament to Africa’s improving status as an investment destination in the current global environment of low yields.
“Through our investment approach of active involvement in the management of our portfolio companies, AIIM has been able to develop a portfolio of mature toll road concessions with operations and governance on a par with those seen in developed markets,” he noted.
SAIF chairperson Andrew Canter said that the success of the transaction was an example of how private equity investors created value in the companies they owned and operated.
“The SAIF investors were early pioneers in establishing the private infrastructure equity sector in South Africa, and the proof of that model is path-breaking for the wider investment community,” he said.
The realisation process of the toll roads was managed through competitive bids to ensure transparency and protection of all parties and saw strong interest from both local and international investors.