Komfie Manalo, Opalesque Asia:
Africa offers investors plenty of idiosyncratic opportunities and market
inefficiencies. There are approximately 100 Africa-focused funds, many of them
managed from outside Africa. The investment interest in the region is driven by
European single and multi-family offices, some of the very large asset consultants
have all been over the continent looking at some of the local managers.
These were some of the findings of hedge fund and asset managers who attended the
recent Opalesque South Africa Roundtable in Cape Town.
Andre Steyn, portfolio manager at Africa-focused alternative investment firm Steyn Capital Management said, "In
Africa, we have about 1,200 listed stocks currently, so the universe we are looking
at is roughly three times the size of South Africa. But, the market capitalization
is a lot smaller. It still lends itself to a number of opportunities. In terms of
market inefficiencies, it’s a nice place to be. One of our current trades is in a
rights offering, where we are buying the rights including the premium, at 1.50 and
selling the shares at over 2. There are several idiosyncratic opportunities like
this where we are able to participate, given our modest fund size."
Steyn made the comments after James Gilfillan, chief investment strategist at
investment advisory firm ......................
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