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Date of incorporation: March 2016
Preference shares in issue: 4 143 332*
Auditor: Morison Mauritius
Preference share market capitalization: USD 4.7 million
Number of equity investment holdings: 4
Net asset value per preference share: USD 1.14


The Company’s objective is to generate above average investment returns from the investment opportunities the Directors introduce through their involvement with various investment structures and/or corporate networks, mainly in Africa. The Company evaluates investment decisions with the aim to deliver a total USD portfolio return of at least 12,5% per annum above the annual change in the United States Consumer Price Index over the lifetime of the investment.

The Company may invest in any asset class, listed or unlisted, in any investment market and in any currency provided 75% of its effective investment exposure (other than cash) is in Private Equity Assets. Any individual investment (at cost) may not comprise more than 30% of the total portfolio value at the time, or USD 8.0 million whichever is the greater.


2016 n/a n/a -2.01% 1.64% -0.40%
2017 5.88% 3.95% 3.73% 14.17%


(USD’000) Novare II Alphamin Addis Pharma African Alpha Equity total Cash Total Total %
Nigeria 690 - - - 690 - 690 14.1%
Zambia 347 - - - 347 - 347 7.1%
Mozambique 267 - - - 267 - 267 5.5%
DRC - 1,226 - - 1,226 - 1,226 25.0%
Ethopia - - 249 259 508 - 508 10.4%
Cash & Networking Capital 111 - - - 111 1,746 1,857 37.9%
TOTAL 1,414 1,226 249 259 3,148 1,746 4,894 100.0%


(USD’000) Novare II Alphamin Addis Pharma African Alpha Equity total Liquid assets Total %
Mining - 1,226 - - 1,226 - 1,226 25.0%
Property 1,303 - - - 1,303 - 1,303 26.6%
Manufacturing & Distribution - - 249 259 508 - 508 10.4%
Cash & Networking Capital 111 - - - 111 1,746 1,857 37.9%
TOTAL 1,414 1,226 249 259 3,148 1,746 4,894 100.0%


APEO made two new investments in the quarter ended 30 September 2017. The current portfolio comprises of:

Novare Africa Property Fund II (“Novare II”)

An investment commitment of USD 2.0 million was made towards Novare II on 30 June 2016 during the fund’s final closing. Novare II is a USD 350 million fund that develops retail and commercial developments in major African cities.

Seventy percent of the investment commitment towards the fund had been drawn down by 30 September 2017. We expect that the remainder of the undrawn commitments will be called for within the next nine months to fund building projects come on stream in Zambia and Mozambique.

Nigerian retail trading conditions have improved following the dramatic strengthening of the black market exchange rate for the Naira/USD. Novare II is on track to complete two shopping malls in the next quarter, and the build projects and leasing profiles of the developments in Lusaka and Maputo are progressing as planned. The projected Novare Fund II annualised IRR of around 20% remains intact.

Alphamin Resources Corporation (“Alphamin”)

We invested USD 1.0 million into Alphamin, a Toronto listed tin mining company in 2016. Alphamin is scoped to be a 13k ton per annum tin mine in 2017 at Bisie, North Kivu Province, in the DRC. The Bisie tin deposit is one of the largest and most significant tin deposits in the world, leaving ample expansion opportunities once a profitable operation has been established.

The development of the mine commenced in the past quarter and the final debt and equity fund raising will be completed in November. The project continues to be supported by a strong tin price. The political situation in the DRC remains tense, but the Northern Kivu Province appears to be stable.


Addis Pharmaceutical Factory Share Company ("Addis Pharma")

APEO invested USD 250K in October 2016 for a small share into Addis Pharma, a leading pharmaceutical manufacturer in Ethiopia when a co-investment opportunity presented itself. Addis Pharma manufactures a large number of products across different therapeutic categories that it supplies to both the Government and private sector in Ethiopia.

The operations continue to trade profitably in line with expectations and well ahead of the prior year, and the very significant expansion of the factory is progressing well. The new plant is expected to be commissioned during 2018, and will create the necessary capacity to take up a bigger slice of the local pharmaceutical market in line with government stated policy of promoting import replacement. The investment remains in APEO’s books at cost.


African Alpha FCMG group ("African Alpha")

APEO invested expansion capital of USD 250k into African Alpha, a fast moving consumer goods (“FMCG”) company in Ethiopia following our in country visit to Ethiopia in June 2017. African Alpha’s is ultimately managed by the same private equity partner responsible for Addis Pharma, and comprises of water bottling plants, a soap and detergent factory, an edible oil bottling plant, a milling and pasta factory, and a dairy plant, all situated in and around Addis Ababa.

All the businesses have in country recognized brands, and a new management team with strong international FMCG experience was assembled over the past year( largely from India) to extract value from the group by combining procurement, marketing, administration, and sales and distribution activities across the businesses which were all operating separately from each other before.

The group broke even on a pro forma basis at an EBITDA level for the year to June 2017, with very aggressive sales and profitability targets set for the next five years. We had the opportunity to invest more, but decided to just dip our toes in the water, and to then follow on once results start to come through.


Cash balances include an investment of USD500k in New Look Senior Bond Notes listed on the Luxembourg stock exchange maturing in 2023 with an annualised cash interest yield of 15%, and an annualised yield to maturity of 25%. The investment was made at a significant discount to face value on the basis that New Look’s holding company Brait has the track record and ability to turn New Look, a largely UK based fashion retailer, around.

We are holding the cash requirements for future investments and capital calls in a money market/short dated bond fund which achieved a USD 5.9% return year to date and 6.2% in 2016.


Our investments all remain on track to better our underwriting criteria of US inflation plus 12.5% over the next few years. We continue to search for attractively priced investment opportunities where we have good insight into the potential risks and rewards.


Rudolf Pretorius

Brendon Jones

Brett Childs

James Henry


This document is intended to be utilised for information purposes only. Should you choose to use this document for any other purposes other than information, you should do so with the assistance of professional advice. APEO not is acting or purporting to act in any way as an advisor. If you rely on this information for any purpose whatsoever, you do so at your own risk. APEO does not accept any liability of whatever nature and howsoever arising in respect of any claim, damage, loss or expense, whether caused directly or indirectly including consequential loss or loss of profit, arising out of or in connection with you, the user, on the contents of this document, or the user of the information products and services described in this document. This document is for information purposes only and does not constitute or form part of any offer to the public to issue or sell, or any solicitation of any offer to subscribe for or purchase an investment, nor shall it or the fact of its distribution form the basis of, or be relied upon in connection with any contract for investment. Investors should take cognisance of the fact that there are risks involved in buying or selling any financial product. Illustrations, forecasts or hypothetical data are not guaranteed and are provided for illustrative purposes only. The value of financial products can increase as well as decrease over time, depending on the value of the underlying securities and market conditions. Past performance is not necessarily a guide to future performance and no guarantees are provided. The user agrees to submit exclusively to the law of the Republic of Mauritius and the jurisdiction of the courts of the Republic of Mauritius in respect of any disputes arising out of use of this document.

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