British International Investment (BII) has hired Rothschild & Co to review options for how to grow Globeleq, an operator of African power plants, according to people familiar with the matter.
The UK’s development finance institution, formerly known as CDC, owns 70% of Globeleq and is considering bringing in a new investor to join existing minority shareholder Norfund, the people said.
BII’s stake in Globeleq is valued at about $1-billion, one of the people said, asking not to be identified discussing confidential information.
Deliberations are in the early stages and BII is considering a number of options for Globeleq, according to the people. Representatives for Globeleq and Rothschild declined to comment.
“BII uses a number of advisers to help examine strategic options,” a spokesperson for the group said in a statement. “BII has no plans to exit its investment in Globeleq.”
Should BII go on to monetize part of the stake, it would be the latest move by an international financial institution to cash in on a power company in Africa, where reliable and affordable electricity is in high demand. Buyout firm Actis is looking to sell its BTE Renewables business in South Africa, Bloomberg News reported this month, having already disposed of a majority stake in Lekela Power.
Investors are plowing funds into African power infrastructure, particularly renewable projects that can attract so-called green financing due to their sustainable nature and contribution toward tackling climate change.
Globeleq has 13 power plants across Tanzania, South Africa, Ivory Coast, Cameroon and Kenya, according to its website. It generates more than 1 400 MW, and has another 2 000 MW in development. Not all of it is renewable.