Wendel Group agreed last week to acquire South Africa’s Tsebo Group from a Rockwood Private Equity-led consortium in deal value at R5.25 billion or approximately €331 million. The transaction is expected to close by the end of the year, subject to customary conditions and regulatory approvals.
Today Tsebo employs about 34,000 people across 23 countries in Africa providing a range of services to domestic and international clients on the continent. Its portfolio of services offers a wide range of contracted hard, soft and managed infrastructure services to over 3,000 clients across a number of sectors.
Rockwood Private Equity originally acquired Tsebo in 2007 in a secondary buyout from Ethos Private Equity. Since then it has partnered with the firm’s management and also facilitated investments from Nozala Investments and Lereko Investments, two BEE partners. As part of the transaction process, Wendel is negotiating co-investment terms with management and prospective co-investors to ensure that Tsebo’s Level 1 B-BBEE status is maintained.
“Tsebo responds to the growing need of African companies and Africa-based international companies to outsource non-core – yet essential – activities outside of their expertise, in order to focus on their core business,” said Frédéric Lemoine, Chairman of Wendel’s executive board. “Tsebo is a ‘homegrown’ African success story with 45 years of African operating experience, delivering international quality standards to a diversified client base, in over 20 countries.”
On completion the deal will take Wendel’s investments in African companies since 2013 over the €1 billion mark. In July, the private equity firm announced a €120 million investment over the next few years to acquire a 40% stake in SGI Africa, a pan-African developer and operator of shopping malls. Tsebo becomes the fourth company in Wendel’s Africa portfolio alongside SGI Africa, IHS and Saham.
Deutsche Bank and Bowmans provided financial and legal advisory services respectively to Tsebo and Rockwood for the transaction.