Private Equity News & Analysis

Citadel markets sector-specific vehicles

At least $300m has been pledged so far toward the MENA- and East African-focused funds, details about which are expected to emerge in coming months.

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Citadel Capital is raising at least two opportunity-specific funds to invest in the Middle East and East Africa, a spokesperson for the firm confirmed, declining to comment further.

The firm has committed $60 million to the funds, drawn from a total of $200 million that it has set aside to invest in 2010, Ahmed Heikal, Citadel Capital’s chairman and chief executive, told Reuters.

High net worth individuals in the Middle East and Gulf institutions have invested an additional $240 million in the sector-specific funds, details about which will be officially announced in the coming months, Heikal told the news agency. The firm is interested in investments in countries including Algeria, Egypt, Ethiopia, Iraq, Kenya, Sudan, Syria and Uganda, he added.

It is unclear if the funds will invest in multiple deals, or be the vehicles used to finance single platform transactions. The firm began raising its first instututional fund in February, before which it had financed deals individually via 17 opportunity-specific vehicles. Under this strategy, the GP's investment in its deal vehicles had typically been between $30 million and $50 million, with most vehicles ranging in equity size from $100 million to $300 million.

Heikal told sister news site InfrastructureInvestor.com in February that the firm was aiming to hold a first close on the traditional private equity fund, which is targeting $500 million, in the second quarter of this year. The status of this fund is presently unclear.

At the time, Heikal told InfrastructureInvestor.com that Citadel had decided to change its investment strategy in order to increase international institutional participation in its investments and to have capital ready to deploy at all times.

In March, Citadel raised EGP275 million from existing shareholders through its fourth rights issue, taking the firm’s paid-in capital to EGP3 billion. The capital raised would allow the firm “the liquidity to fund expansion plans at a number of our platform companies,” Heikal said at the time.  

The firm manages more than $8.3 billion in investments.