Sanlam Private Equity appoints Fernandez as CEO

Sanlam Private Equity (SPE), the private equity investment business within the Sanlam Group, today announced the
appointment of Cora Fernandez as chief executive officer. Fernandez will take up her new role in SPE's Hyde Park offices in Johannesburg on 1 July 2009.

With close to R5 billion of assets under management, Sanlam Private Equity is one of the largest private equity fund managers in South Africa, offering both a direct and fund-of-funds investment programme.

Fernandez has held the role of deputy CEO of SPE, heading up the Johannesburg branch of the business, since 1 February 2006. Current CEO, Pieter Kriel who co-founded the SPE business, will step down from this post he has held since February 2006, but will remain actively involved in an executive capacity as co-founder and senior partner.

Says Johan van der Merwe, CEO of Sanlam's Investments cluster: "The move is the implementation of an agreement made between Pieter and Cora, in conjunction with myself, in 2006 as part of SPE and Sanlam Investments'
succession planning strategy. During this time, Pieter has been actively committed to supporting Cora's development while establishing SPE as a key player in the private equity environment."

In the past three years, Fernandez has demonstrated that she has the passion for private equity, the business acumen and people leadership capabilities required for success in the private equity environment. Fernandez is a qualified chartered accountant and served her articles with KPMG in Johannesburg, after obtaining her BCom degree from the University of Cape Town, and a BCompt Honours degree from the University of South Africa. Fernandez entered the private equity industry in 2001,
and in her role as deputy CEO at SPE has been responsible for deal origination, investor relations, investment strategy and portfolio management, as well as manager of SPE's Johannesburg branch.

Fernandez holds many leadership positions in the private equity arena, and is currently chairperson of the South African Venture Capital and Private Equity Association (SAVCA), is a member of the South African Institute of Chartered Accountants (SAICA) and the Association of Black Securities and Investment Professionals (ABSIP). She also currently serves on the Investment Committee of the National Empowerment Fund (NEF) and on the boards of eight companies where SPE owns an interest.

Since joining Sanlam's investment division in 1987, Kriel's contribution to the Sanlam Group has been immeasurable. Kriel has over 21 years of experience in investment management, covering various roles including financial control, compliance, structured products, equity underwriting, portfolio management, the structuring and management of black economic empowerment investments and finally private equity.

Kriel currently serves as a non-executive director on the boards of a number of empowerment and other unlisted companies, and is a member of a number of investment committees and governing and advisory boards of private equity and venture capital funds.

During his leadership of SPE, Kriel recruited a team of top dealmakers and created a strong base for future growth of the business. Kriel fully supports the appointment of Fernandez, saying: "I am pleased to see the plans Cora and I made for SPE come to fruition. I remain committed to SPE and look forward to relinquishing my management duties in order to focus my innovative and entrepreneurial acumen and experience to further grow the business".

Kriel will continue to support Fernandez in her new role and will play a pivotal role in the strategic leadership of the business. Says Van der Merwe: "Pieter is a talented entrepreneur and has pioneered many new initiatives in the Sanlam Group. This move frees him up to apply entrepreneurial thinking to new business ideas and products, and to more actively participate in the investment decision making of SPE. He has established an excellent team and I am confident in their ability to
implement the strategic plans of SPE going forward."

"Kriel represents SPE on many internal and external bodies, such as fund advisory boards, and will continue to drive transformation and mentor skills transfer within the investments businesses", adds Van der Merwe.

Fernandez has played a central role in building the SPE business alongside Kriel, and has gained a reputation as a respected and credible businessperson well placed to position the SPE business as one of the preeminent players in the industry.

"Private equity is my passion and becoming the CEO of SPE is the culmination of many years of hard work alongside Pieter, who has been a skilled mentor to me and other members of the team. I look forward to working alongside Pieter to grow SPE into a formidable player in the private equity space," concludes Fernandez.

Venture Capital - Opportunities in education

One of the sectors which seems to be seeing a bit of interest from investors again is the South African education sector - specifically in the mainstream and remedial schooling space.

I was fortunate enough to get an invite down to the PSG Annual General Meeting in Stellenbosch this week and it was actually one of the sectors that their investment team were chatting about and one of the places where they are putting their money into.

One of the statistics that they rolled out in their presentation was that at the moment, only 2.5% of South Africans are enrolled in private education institutions - this despite the explosion in new schools over the last few years.

Their opinion is that this figure is likely to continue to grow as the government school sector comes under increasing pressure and numbers in schools continue to expand.

(Bear in mind when reading this post that one of the real tricks in developing an education offering is an ability to develop and manage scale - i.e. what is the "critical mass" that you need to achieve to make a profitable offering).

A couple of areas where I think there might be some promising opportunities for
investors and small business owners to look at are:

• Remedial school offerings - The number of small remedial school offerings in the last few years has exploded. My wife is very actively involved in this part of the education sector and she sees the trend continuing as people seek specialist care for children with remedial and special education needs.

• E-learning - This is without question one of the most promising but uncertain parts of the South African education landscape. Electronic learning has started to take roots in the universities and one can expect this to continue to evolve as it becomes a more mainstream education tool at all levels

• Middle level income primary and high-school offerings - Private education continues to be viewed as a tool for "the rich" but more and more parents in the middle-income bracket are making sacrifices for their kids to receive a higher quality education. I know that there are a couple of schools in this space due to come online over the next few years and might be another area to explore
• Basic financial eduction - This is one of the areas which our sideline business has been developing content for the last few years. The demand for basic financial education for your workforce has been further highlighted by the current financial and economic crisis.

I think there are some genuine opportunities in education in South Africa for investors who can get their heads around the sector.

Source: Bad Entrepreneur blog

SME resource

For SME's looking for a nice resource to assist them in getting started up, you should check out the Small Capital website.

"Partnered by the country’s top providers of three core business services – Standard Bank, MTN and Microsoft – Small Capital shares expert knowledge of the local market and business environment, while providing access to products, services and tools that will help you to turn your small business of today into the powerhouse of tomorrow."

Standard Bank and Microsoft seem to be very active in the SME space at the moment - well done to both these teams for helping out local entrepreneurs.

Evolution One Fund secures ZAR 100 million from first African investor

The Board of Directors of the African Development Bank Group (AfDB) approved a ZAR 100 Million equity investment in the Evolution One Fund on Wednesday 27th May 2009, the first specialised private equity fund focused on the acceleration and deployment of clean energy and sustainable technologies across southern Africa to mitigate the effects of climate change on the Continent. Evolution One Fund has already raised USD54m in cornerstone capital commitments from four international investors and the AfDB investment will substantively augment this capital pool.

The Evolution One Fund will make equity and equity-related investments in sustainable projects and companies with the aim of not only achieving carbon reductions but also ensuring the sound environmental, social and economic performance of these investments. The Fund will seek to invest predominantly in growth-phase businesses, particularly in eight high-growth sectors namely clean energy/energy efficiency (up to 50% of its investments), efficient and clean manufacturing processes and technologies (“cleaner production”), air quality and emissions control, water quality and management, waste management, agribusiness and forestry, natural products, organics and natural health and environmental real estate. South Africa will account for 60-75% of the Fund’s overall investments, while up to 25-40% will be earmarked for all other Southern African Development Community (SADC) countries.

Climate change is a crosscutting theme for the African Development Bank with a focus on supporting clean energy investments and infrastructure, as set out in the Bank’s Medium Term Strategy 2008-2012, as well as its Clean Energy Investment Framework (CEIF), which underscores the Bank Group’s increased support to clean energy projects. The Evolution One Fund will be the Bank’s first investment in a fund with a specific focus on clean energy and technology investments. The investment therefore supports an innovative vehicle that will boost economic activity in this emerging field, and contribute to the development of sustainable private sector enterprises.