Botswana’s iconic financial services provider, Botswana Insurance Holdings Limited (BIHL) is ready to roll out its Private Equity Fund (PEF), BG Business has established.“At this point we intend that our PEF will be at full speed and ready for a formal launch by early to mid 2013,” Gaffar Hassam, BIHL Chief Executive told BG Business on Tuesday.
A private equity fund is a collective investment scheme used for making investments in various equity (and to a lesser extent debt) securities according to one of the investment strategies associated with private equity.Hassam said their goal is to have this fund manage approximately P1.2 billion to P1.5 billion. However BIHL has already committed close to P400 million into the fund.
“It is important to note that we have in fact already started offering some PEF services. The services are being handled temporarily through internal vehicles at Botswana Insurance Fund Management (Bifm). Once we have finalised our offshore registrations, our PEF will be able to ‘hit the ground running’ as we would have had the benefit of taking on current opportunities though Bifm,” Hassam told BG Business.
The fund was necessary at this time which was driven by the group’s desire to be able to offer clients’ improved risk adjusted returns. He said the Fund will offer its clients access to Private Investments that under normal circumstances may not have been available to clients.
“We are very excited about this new product which once again demonstrates our ability to grow shareholder value. We believe that the fund, will be welcomed by the market and thus we are looking forward to when we have it fully operational in the middle of 2013 to be able to stand shoulder to shoulder with our suite of offerings at the BIHL Group,” Hassam said.
The fund, according to Kudzani Pickup, head of unlisted investments at BiFM, will see BIHL, which owns both Bifm and Botswana Life Insurance Limited (BLIL), investing in world renowned and reputable companies. “After making specific amounts of returns from those offshore investments, we will allow our clients and investors to invest in that fund which would be the PEF, for a certain period of time and then distribute returns to them when the investment matures,” said Pickup. Targeted investment industries according to Pickup are the mining, oil industries and any other money spinning international companies. “However, BIHL will allow its clients to choose the type of industries or organisations they prefer to invest in, and the duration they are looking at, then we invest on their behalf using the PEF,” he explained, stressing that the PEF would be controlled to the clients’ advantage to minimise risks that may occur.
Both Hassam and Pickup are in agreement that PEF investment would give clients and investors international exposure and growth and would also come with a diversified investment plan, at a controlled manner and also enable clients to make great returns. BIHL was listed on Botswana Stock Exchange (BSE) in 1991. It currently boasts of a P3 billion market capitalisation, with over P281 million shares.