Vantage invests $30m in Ghana operations
Vantage Risk Capital has committed to invest up to $30 million (R280 million) worth of mezzanine capital to Genser Energy’s Ghana-based operations.
The deal marks Vantage’s first investment in West Africa, and its second transaction outside South Africa. Vantage’s financing will primarily go into the completion of the Chirano power plant, which is set to provide energy to Kinross Gold Corporation.
“We reviewed over 80 investment opportunities in the region, and we consider Genser to be in the top decile of the deals we have seen,” said Luc Albinski managing partner at Vantage.
Part of the capital will also boost Genser’s plans to commercialise a natural gas project. The company has been working on a strategy to capture, process and liquefy natural gas, from an oil rig located about 12 miles off Ghana’s coast. The gas, currently being flared into the atmosphere, will go into the production of electricity, heat and steam. Yaw Keteku, investment professional at Vantage, also worked on the deal.
Based in Accra, Genser Ghana primarily services industrial and mining clients in the country. The company’s target is to produce almost 50 megawatts of electricity by 2013 year-end, and to triple capacity over the next few years. Genser Ghana operates under the umbrella of Genser Energy USA, an independent power producer based in the US, with operations in Ghana Sierra Leone and Liberia.
Robyn Nathan, tax director at KPMG Johannesburg commented:
“Our scope was restricted to considering the South African and Ghana tax implications for the partnership and South African investors in the partnership. The tax landscape in Africa is uncertain. The African continent is not always familiar with complex funding structures. We worked closely with KPMG in Ghana to advise on the tax implications arising from funding and remittance of interest from Ghana, and redemption of participating preference shares.”