Baring Asset Management has launched a new fund that will invest in African securities, including shares in Morocco, Tunisia and Egypt. The Simba Fund aims to take advantage of the opportunities being created by the economic reforms being undertaken by countries throughout Africa. About 10 per cent of the funds raised will be placed in the three North African countries, although Barings says this proportion could rise after the first 18 months.
‘Africa is one of the least understood but, by the same token, one of the most exciting emerging markets,’ Michael Power, investment manager of Simba said in a statement. ‘According to statistics from the IMF, after Asia, Africa is likely to be the second fastest growing region in the world for the balance of this century. Baring Asset Management believes it is ideally suited to take advantage of this investment opportunity; it currently manages about $8,000 million in emerging markets.’
The funds will be invested in listed and unlisted equity and equity-related securities in African companies, or those companies whose activities are based in Africa. No more than 15 per cent of Simba’s net asset value will be invested in unlisted securities or in any one country, with the exception of South Africa.
Funds will be raised by issuing shares with warrants attached, and will be capped at $100 million. The closing date will be in early December. The funds will be open-ended for legal and regulatory purposes, but will be closed at the election of shareholders until a date, no later than 31 December 2000. Simba, which is sponsored by Baring Brothers, will be listed on the London stock exchange and incorporated in Guernsey.
Outside North Africa, the countries being targeted include Zimbabwe, Ghana, Mauritius, Cote d’Ivoire, Kenya, Botswana, Swaziland, Namibia and Zambia.