Blackstone eyes opportunities in Africa’s power shortages

Blackstone Group, a global private equity and advisory firm, has partnered with Aliko Dangote on a $5 billion joint venture to develop infrastructure projects involving power generation and transmission across the continent.

Stephen Schwarzman, the Chairman and CEO of the Blackstone Group noted at the Reuters Africa Investment Summit that there was a very good opportunity for private equity firms in the continent presented by a great need for capital and a relatively underdeveloped private-equity sector.

Blackstone has however taken a novel approach of partnering with local firms to identify, develop, and operate large-scale investments. The Black Rhino, Dangote partnership joins the group’s Africa based investment portfolio that includes a $116 million investment into Sithe Global, a company working to revive the Bujagali dam in Uganda. The group is also working with the Ethiopia and Djibouti governments to develop a pipeline for refined fuel between the two nations.

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The approach of partnering with organizations can prove effective at accelerating investments provided the institutions share a similar investment philosophy or can constructively harness differences in perspective to build a robust investment thesis. The ability to identify the right partners and remain aligned in executing a joint strategy are critical components of a successful partnership. What other elements have you experienced as key success factors in building partnerships in Africa?


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