Actis, a London based emerging markets firm, has appointed a new director for its value creation group in a bid to improve the operational performance of its African portfolio companies, it said in a statement.
South African born James Smith, 36, will be based in Johannesburg and work with three or four portfolio companies and their existing managements, he told Private Equity International. Actis and Smith already have an established relationship. Smith advised the firm through his consultancy company, Burlington Strategy Advisors. Prior to that, Smith worked as a consultant at Bain & Company.
There is a lack of talent, not just in the management teams, but throughout the businesses
James Smith, Actis
Actis’s value creation group is run by Joe Sinyor in London. The group has six directors that are based in London, Sao Paulo, Beijing, Singapore, Mumbai and Johannesburg. With the appointment of James Smith, the value creation group is complete, Actis said, adding that the team could be expanded in the future if necessary.
This focus on operational improvement is a global trend, Smith said. “As the market gets more competitive it’s necessary to go beyond the traditional private equity model and to add more value to the [portfolio] company,” he said.
Portfolio companies can face a lot of challenges, particularly in emerging markets, because of the high levels of growth, Smith added. “Finding quality people can be challenging. There is a lack of talent [in emerging markets], not just in the management teams, but throughout the businesses. That’s why it’s important private equity firms can bring skills to the table when necessary”.
Nearly half of Actis’s investments are located in Africa. The firm has invested more than $1.7 billion across 18 African countries. It has $5 billion funds under management, and is currently attempting to raise $3.5 billion for Actis Global 4.