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MTN shares on the rise after board changes

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DURBAN – The share price of Africa’s largest mobile operator, MTN, rose 2.78 percent on the JSE after it announced several changes to its board in a bid to strengthen its executive team. The share closed at R105.30 on Friday.

MTN has appointed former deputy minister of finance Mcebisi Jonas as its chairperson-designate to replace Phuthuma Nhleko, who is stepping down in mid-December.

Jonas is no stranger to the MTN board. Last May, he was appointed as an independent non-executive director after being fired by then-president Jacob Zuma in 2017.

Nhleko has delayed his departure by six months to oversee the formation of the international advisory board (IAB), which he would serve as a member.

The five-member IAB will be chaired by former president Thabo Mbeki and will include former President of Ghana John Kufuor; Dr Aisha Abdullahi, former African Union commissioner for political affairs; Dr Mohammed el Baradei, former director general of the International Atomic Energy Agency; and Dr Momar Nguer, president of marketing and services Total SA.

MTN said the main purpose of the IAB would be to counsel, guide and support the MTN Group from time to time in fulfilling its vision and objective of being one of the premier African corporations with a global footprint in telecommunications, contributing to increased digital inclusion in Africa and the Middle East, a pivotal aspect of the fourth industrial revolution.

Other key changes include Dr Khotso Mokhele, who will become a lead independent director from December 15, and Lamido Sanusi, a Nigerian national and former governor of the Central Bank of Nigeria and Vincent Rague, a Kenyan national who worked for the International Finance Corporation, both with effect from July 1.

Alan Harper, Jeff Van Rooyen and Koosum Kaylan will step down from the board on December 15, while Peter Mageza and Dawn Marole would step down next year.

Peter Takaendesa, a portfolio manager at Mergence Investment Managers, said there were two important things that the MTN board had announced: the appointment of new non-executive directors and setting up of a new IAB.

“One of the key challenges MTN has faced in the past five years has been costly fines from African governments, especially in West Africa, and our view is that some of those sanctions were due to weaker relationships with relevant stakeholders. We, therefore, believe that the well-respected new non-executive directors and members of the IAB will go a long way in reducing those risks,” Takaendesa said.

Nhleko led negotiations after the group fell out with Nigeria after local authorities slapped MTN with a $5.2 billion (R74.48bn) fine in 2015 for failing to disconnect unregistered SIM cards on its network.

The fine was later reduced to $1.7bn after a series of negotiations with the Nigerian government, with the fine leading to MTN reporting losses for the first time in its 2016 financial results.

Last September, MTN was ordered by Nigeria’s central bank to refund about $8.13bn that it allegedly had illegally repatriated from the country.

Takaendesa said there was no doubt on the contribution that Nhleko has made on connecting the African continent to telecommunication services and the fruits of his vision decades ago would continue to benefit many stakeholders for decades to come.

“His influence on MTN will be diluted going forward, but his guidance will not be lost, as he will join the IAB. However, a number of investors in MTN have been calling for an independent chairperson to strengthen corporate governance further, and Jonas has been asked to step into that position.

There is no guarantee that problems in Nigeria will become a thing of the past, but Jonas will have very strong support from both the newly appointed non-executive directors, including former Nigeria central bank governor, and IAB with solid African leadership experience,” Takaendesa said. He said MTN was now in a much stronger position compared with where it was 12 to 18 months ago.

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Investment

Releaf secures $4.2 million in seed funding and grants to drive industrialisation of food processing in Africa

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Releaf co-Founders (Image: Supplied)

Releaf, an agtech start-up that develops proprietary hardware and software solutions that makes African farmers and food factories more efficient and profitable, has raised $2.7 million seed funding in a round led by Samurai Incubate Africa, Future Africa and Consonance Investment Managers with participation from Stephen Pagliuca, Chairman of Bain Capital and Justin Kan (Twitch). Releaf also secured $1.5 million in grants from The Challenge Fund for Youth Employment (CFYE) and USAID.

The seed funding will enable the development of industrial food processing technology in Nigeria’s smallholder-driven Oil Palm sector while the grant will enable Releaf to provide working capital and other value-added services for smallholders and small-scale processors. Grant funding will support the training, recruitment and retention of more women and youth in Nigeria Oil Palm sector through the creation of both digital and technical jobs.

Nigeria’s oil palm industry is dominated by smallholder farmers, with 80 percent of local market share. However, production rates are low because many still rely on ineffective processes for de-shelling, including the use of rocks and inappropriate hardware. These ineffective processes also lead to low quality palm kernels which are largely unfit as input for high quality vegetable oil manufacturing. As a result, food factories are unable to purchase these raw materials and operate significantly under capacity. On average, food factories have 3X more installed capacity than utilization, which impacts the cost of food and hampers further investment into processing capacity.

Releaf acts as a bridge between smallholder farmers and food manufacturing companies with its proprietary patent-pending machinery, Kraken. Kraken can process any quality of palm nut into premium quality (95 percent purity) inputs for food factories. Releaf’s software connects the start-up to more than 2,000 smallholder farmers, ensuring consistent, large-scale supply. While palm kernel oil production is not foreign to Nigeria, Releaf’s technology and scale means it can process 500 tonnes of palm nuts per week. The software offerings also allow the start-up to receive inbound supply requests from farmers via USSD, provide working capital financing as well as collect proprietary data on supply availability.

Speaking about the new funding, Ikenna Nzewi, CEO and co-founder of Releaf, said, “our mandate is to industrialize Africa’s food processing industry. This round of funding enables us to develop and prove our technology with smallholder farmers in the oil palm sector. Given Nigerians spend ~60 percent of their income on food and Africa’s population is set to increase by 100,000 people per day over the next three decades, we’re presented with an incredible opportunity to feed more people, reduce consumer costs, and supply the fastest-growing food market in the world. Releaf is committed to harnessing technology to accelerate the economic wealth of rural, agrarian societies throughout the Continent. We firmly believe that a robust real economy is the foundation for long-lasting and shared prosperity for Africans and are excited to deepen partnerships with like-minded organizations, governments, and firms.”

This new funding will enable better productivity and accelerate the eradication of the menial and archaic processes that are prevalent across Nigeria’s oil palm sector and the agriculture sector as a whole. It will also enable Releaf to drive more value and profitability across the oil palm value chain, as well as support direct and ancillary job creation in the farming communities of South and Eastern Nigeria.

Rena Yoneyama, Managing Partner at Samurai Incubate Africa who led the round commented, “Releaf’s novel approach to operating within the value chain with proprietary technology set it aside from many agtech startups we have spoken to. We believe the firm’s thesis on decentralizing food processing would have a strong match with Africa’s economic development landscape for the next few decades. Ikenna and Uzo are the perfect founders to disrupt this market in Nigeria and beyond. We are thrilled to back them as they innovate in providing both agro-processing and financial services to rural communities and farmers.”

Iyin Aboyeji, General Partner at Future.Africa noted, “more than 50% of the goods in supermarkets globally contain glycerine – an extract made from palm oil – a cash crop that is passed down from generation to generation. The team at Releaf is building the agro-allied industry of the future from the ground up starting with palm oil which they have developed novel technology to aggregate, deshell and process into critical ingredients like vegetable oil and glycerine. Future Africa is delighted to back Releaf to build the future of modern agriculture”

Dr. Nneka Enwonwu, Country Relationship Manager, from The Challenge Fund for Youth Employment (CFYE) said, “We are thrilled to partner with Releaf on their mission to improve efficiency and profitability for farmers and food factories in Africa. The founders’ vision and the team’s enthusiasm gave us confidence that Releaf will deliver real value for rural communities and create digital/technical jobs for women and youth. We are looking forward to their results and success over the coming years and continuing to support their work.”

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CEO Corner

Graça Machel Trust Appoints Melizsa Mugyenyi as New Chief Executive Officer

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Graça Machel Trust New CEO, Ms. Melizsa Mugyenyi (Image: Supplied)

Board of Trustees of the Graça Machel Trust, announces that Ms. Melizsa Mugyenyi has been appointed as the new Chief Executive Officer (CEO) and commences her tenure in this leadership role as of September 6, 2021.

A Ugandan by birth, and residing in Kenya currently, Ms. Mugyenyi brings to the Graça Machel Trust an impressive range of executive management and strategic partnership building skills, as well as extensive experience working in multi-country settings. We look forward to her leadership to expand our Pan African programming, nurture our diverse women’s empowerment Networks, and develop the necessary relationships to fortify our resource base and long-term sustainability.

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Ms. Mugyenyi will spearhead the conceptualization and implementation of a bold new Strategic Plan for our institution and take our work of social and economic transformation to greater scale and impact. The Board has every confidence in Ms. Mugyenyi and her ability to effectively steer our organization, in conjunction with our staff and stakeholders, to augment our impact on the African continent and expand our thought leadership globally.

“We are grateful to Dr. Shungu Gwarinda, who steadfastly served as our Interim CEO, driving us forward with a determined focus on advancing the rights of Africa’s women and children, and strengthening our institution and Networks during this interim period.  Dr. Gwarinda will be actively supporting this management transition and will resume concentrating her leadership in her substantive role as Director of Programmes.  We are grateful for her invaluable contributions to further the mission of the Graça Machel Trust”. said Mrs. Graҫa Machel, Founder and Chairperson of the Graҫa Machel Trust

To our valued partners, both current and future, we look forward to positively transforming the lives of Africa’s women and children together with you as we enter this exciting new chapter of our institution’s journey.

 

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Press Release

Pezesha Raises Seven-figure Seed Extension from GreenHouse Capital to Fuel Expansion of its Embedded Credit Infrastructure across Africa

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Pezesha team (Image: Supplied)

Pezesha, a pan-African fintech company building scalable lending infrastructure for SMEs and institutions, today announced the close of a seven-figure growth funding round led by GreenHouse Capital (GHC). In addition to GHC’s investment, Pezesha received on-lending liquidity support from GHC’s sister company Venture Garden Group (VGG). These financing milestones will support Pezesha’s continued growth across Africa and its mission to expand access to affordable working capital for SMEs.

Pezesha is solving Africa’s $82 billion working capital and trade finance access problems by enabling non-traditional finance institutions to offer working capital to SMEs using Pezesha’s lending infrastructure. The company has built robust APIs to originate quality SMEs and original credit scoring models that allow capital to flow efficiently and productively. Pezesha’s new partnership with VGG will expand the capital available for Pezesha and its institutional partners to lend to SMEs. Pezesha previously raised capital from Consonance and Seedstars.

Hilda Moraa, CEO and Founder of Pezesha, commented, “we are delighted to have GreenHouse Capital join the Pezesha family. We are aligned in vision as well as our commitment to solving the working capital challenges that are preventing African SMEs from achieving their full growth potential. GHC’s investment will catapult our growth by enabling us to scale our existing partnerships with the likes of Twiga Foods, Jumia, Marketforce, and Popote Pay, among others. More so, the investment will unlock our vision of building the operating system to power embedded finance in Africa”

Ruby Nimkar, Principal at GreenHouse Capital, added, “Pezesha is breaking down barriers to SME financing by taking an ecosystem approach to the problem of access to capital. Their embedded finance model is truly groundbreaking, and we have full confidence in Hilda and her talented team to take their model into new markets and continuously close the SME financing gap across Africa.”

Bunmi Akinyemiju, CEO of Venture Garden Group, commented, “Pezesha’s innovative model is driving capital to the African SMEs that need it the most. We are excited to be partnering with them to expand their access to funds that they can use for their on-lending liquidity.”

Pezesha has scaled its lending infrastructure in Kenya, Ghana, and Nigeria and is planning to launch in Uganda in September of 2021.

 

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