Denham commits $200m to African mining partnership

The partnership with South Africa’s Pangea Exploration is considering mining opportunities in Mozambique, Botswana, Namibia as well as West and Southern Africa.

Denham Capital Management is launching an African mining platform in partnership with South African mining company Pangea Exploration, the firm announced in a statement. The energy and natural resources firm has committed $200 million to the partnership, which will target investments in natural resources like gold, platinum, group metals, iron ore, coal and copper across Africa.

The unnamed partnership will pursue investments across several project stages, including de-risking, resource expansion, cash flow development and operating assets, according to Denham

“We see a number of opportunities in Africa for the new platform right now, including coal in Mozambique, diversification away from diamonds in Botswana, new copper discoveries in Botswana and Namibia and manganese in Southern Africa, and West Africa as a new iron ore supply province.,” Denham director Bert Koth said.

It is unclear whether the firm made the commitment through its most recent fund, Denham Commodity Partners VI, which was scheduled to hold a first close on $1.8 billion last month on its way to a $2.5 billion target.

The fund, which will focus on investments in the energy and commodity sector, had been on track to close on its target in the first quarter of next year, according to source with knowledge of the fundraising, who spoke to Private Equity International in a prior interview. Denham was getting a good response from new limited partners, who were attracted to the potential for non-US energy-related exposure, as well as the mining focus of the firm, the source said.

In addition to fundraising, Denham has also been active in the market recently. Since July, the firm has made a pair of $200 million investments in two Texas-based companies; energy infrastructure service provider Tradition Midstream as well as oil and gas exploration and production company Ursa Resources Group.

Denham was founded in 2004 as former hedge fund Sowood Capital’s private equity energy group. The firm manages more than $4 billion of invested and committed capital and maintains offices in Boston, Houston, New Jersey, London, Sao Paulo and Singapore.