Frontier markets are the place to be, according to a family office fund manager quoted by Reuters. He said that valuations are like those for the BRIC (Brazil, Russia, India, China) countries 10 to 20 years ago. It is among private high-net-worth investors that frontier markets are gaining ground. “With both the capital and appetite for new ventures, along with the skill to create and quickly exploit opportunities, wealthy investors who have come through the financial crisis seem ready to explore new alternatives,” says ftse global markets.com .
Reuters reports that the value of private equity deals completed in sub-Saharan Africa rose nearly 10 percent in 2012 to USD 1.16 billion, according to the Emerging Markets Private Equity Association (EMPEA), similar to the amount completed in Russia. This year the investments are already at USD 850 million, according EMPEA said. African private equity funds outperformed US venture capital over the 10 years to September 2012, says Reuters, posting an 11.2 percent annualised return, citing a study by Cambridge Associates and the African Venture Capital Association.
Frontier markets in Asia are Sri Lanka and Pakistan, while Argentina is the target in Latin America. In Africa, investors are looking at Ghana, Tanzania, and Kenya. And in Europe, there is nascent investment activity in tiny states like Macedonia, Bosnia, Belarus, and Armenia, according to ftse globlal markets. Family offices named in the article include One Thousand & One Voices, based in South Africa, Fleming Family & Partners, and France’s Wendel family office. (Image Source: Pyramid Research)