As Africa becomes an increasing focus for offshore law firms with funds practices, Harneys has bolstered its partnership with the promotion of a private equity and hedge funds attorney who heads the firm’s Africa team.
Patrick Colegrave, a London-based attorney and former Linklaters associate, practices Cayman Islands and British Virgin Islands law. He advises clients on the establishment of hedge, venture, and private equity funds in offshore jurisdictions, as well as the structuring of portfolio acquisitions. Yet another area of Colegrave’s practice involves M&A, joint ventures, restructurings, and other corporate transactions.
“The main interest at the moment, in the Africa funds space, seems to be in the closed ended / private equity field. We are seeing an increase in interest from established global players, for example Carlyle who closed their first Africa fund and KKR,” Colegrave said. “In addition to this, you have large players with a long established record of investing in Africa including Actis, Helios, and ECP and a raft of local managers. There is a diversity of approach and strategy among the funds with some being pan-African, typically the larger funds, some being regional, and some being sector-specific.”
Colegrave added that at the moment, Mauritius is a highly popular jurisdiction for deals in the Africa space. Colegrave and his colleagues have an association with BLC Chambers, which he described as one of the leading law firms active in Mauritius, through which Harneys lawyers can offer Mauritian law advice.
Nevertheless, Cayman retains its primacy as a popular venue for funds transactions.
“Typically, we see Cayman used in the closed-ended / private equity space, where there is some U.S. involvement in the fund. U.S. managers and general partners are used to Cayman, they like Cayman, and it’s not uncommon to see them using Cayman,” Colegrave said.
Among managers in both the open-ended and closed-ended space, investing in sub-Saharan Africa is still by no means mainstream. The managers have to go out and fundraise, and can find it quite challenging. The allocations to that part of the world, relative to other emerging market regions, are still relatively small, Colegrave said.
“It is fair to say that it’s becoming more of a recognized market, and an indication of that is the size of some of the funds being set up, especially in the private equity space, and also the international players entering the space. In terms of industry growth, I see fund raising as one of the key challenges,” he commented.