The peculiar role of private equity in economic growth explained
• An investment specialists says it’s about turning companies into champions
Traditionally across the globe, private equity firms exist to provide investors with profits, manage investments, invest in existing or new companies and generally specialise in portfolio management in fund management.
Otherwise known as PEs, in Botswana, one such notable company is Africa Lighthouse Capital founded by none other than Bame Pule, who is its current Chief Executive Officer (CEO). Pule is a reputable and dynamic private equity investor and his company is one of Botswana’s internationally recognised and largest equity investment firms.
At a ceremony to celebrate acquisition and rebranding of Aon Botswana this week, he explained the role of private equity investment to the development of the country. This is because as a prominent business, Africa Lighthouse Capital, the company he founded, has since invested in Minet Botswana (formerly Aon Botswana) to make it a meaningful contributor to the economy.
Speaking at the launch Minet Botswana, Pule seized the moment to unpack the role played by equity investors. He shared the sad narrative that the Botswana economy has not been as dynamic as it might have been and that it had no features of job creation as “we would like it to”. Sharing insights, he said through his company’s investments, they intend to bring growth and innovation to the economy by helping Batswana managers increase ownership in the entities they lead.
According to the PE expert, investments bring shareholder alignment, “and this is one of the many Botswana investment(s) we want to do as Lighthouse Capital”, he said. Pule noted that there is tremendous potential in Botswana that as a globally experienced investment company, it is their duty to turn companies into champions. He added that equity investors bring management accountability, company renewal and transformation of the economy.
“It’s time for new growth strategies,” he said. “We must think of today as a renewal, and that is our outlook as we embark on this journey.” The Chairman of Minet Botswana Board, Chris Mokgware, said the acquisition of Aon Botswana by Minet Group and Africa Lighthouse Capital will bring about enhanced service provision to the company clientele even as it came at challenging trading times when the world is grappling the COVID-19 pandemic.
They intend to leverage on the Africa Free Trade Agreement, he added. “I and my board have confidence that we will navigate the challenges and unlock future growth,” Mokgware said. In July 2019, Pule was among 16 people appointed to the National Transformation Strategy Team by President Mokgweetsi Masisi. The team was setup to guide Botswana’s economic revitalisation and policy formation. However, Masisi’s administration has been heavily criticized for failing to turn the economy around even after assembling a team of seasoned professionals and making promises of a policy major shift and economic productivity.