Barak Fund Management has set up Barak UK Limited in London and hired former Bunge head of business development, Marc de Hennin, to run it.
In his new position, de Hennin is tasked with fundraising and sourcing transactions in London, developing Barak’s soon-to-be-launched medium-term Mikopo fund and long-term Asha fund, as well as setting up a private equity division.
de Hennin began his career in investment banking, where he remained for 15 years. He then joined LCF Edmond de Rothschild London, responsible for alternative investments and developing the company’s expertise in renewable energy generation, energy efficiency, natural resources, waste management and sustainable infrastructure. He also spent time at FourWinds Capital, where he was responsible for institutional relations, fundraising and sourcing of new investments globally.
de Hennin went on to join Bunge Global Agribusiness in 2011, where he was accountable for investor relations, fundraising, strategy and product development for Bunge Asset Management (BAM). As part of his remit at Bunge, he was tasked with setting up a private equity fund that would focus on agribusiness and renewable energy in Africa. Despite securing local and DFI partnerships, sovereign investment and a great deal of interest from the market, Bunge pulled the plug on the project in 2015 and de Hennin’s team was instructed to wind down the business.
He was recruited by Barak last month, and as part of his responsibilities there, will be replicating what he had previously worked on at Bunge in terms of a private equity agri-focused division.
Barak will soon be launching two new funds: the Mikopo fund is a medium-term development fund with three to four-year investments catering for capital projects of producers, processors and supply chain managers in Africa. The Asha fund is a long-term debt instrument secured by tangible operating assets and cashflows, with the option to convert to equity to participate in higher returns. The targeted investment horizon is seven to 10 years.
“The initial Structured Trade Finance fund was great, but it was only for up to one year. There has been a lot of interest in going up the interest rate curve. Many African businesses need medium and long-term debt,” de Hennin tells GTR. The funds will be utilised for the development, expansion and growth of businesses that have a core focus on social impact to uplift the broader community.
“DFIs will be our first target investors for the Mikopo fund, but we will also approach the pension fund world and family offices for both the Mikopo and Asha funds,” de Hennin explains.
Barak is also set to develop the first FX fund focused on African currencies, which is due to launch in May 2016, he says.
The slump in commodity prices, coupled with a withdrawal of banks from the African market, means that funds and asset managers have a larger role to play on the continent, especially with regards to SME borrowers. As a result, Barak is facing increased demand for financing, including bridge loans, from these companies. “Now we need to raise more capital,” de Hennin says.
Barak Fund Management was founded in 2009 by former bankers Jean Craven and Prieur du Plessis. As of March 2016, the assets under management of the flagship Structured Trade Finance fund sit in excess of US$300mn. The investment team is confident that the deal pipeline for the remainder of the year is strong enough to facilitate increased invesment capital into the fund, and continues to look for sound Sub-Saharan African investment opportunities that will focus on stable, risk-adjusted returns for 2016.