“We haven’t disclosed the amount, but from our private equity fund we are typically making investments between 10 million dollars and 30 million dollars. This investment fits within that range as well,” Investec Asset Management investment principal Mark Jennings told CNBC Africa.
The South African banking and asset management company's investment in Daraju follows other investments in established mid-market companies in Africa.
Daraju mainly focuses on trading and manufacturing, and is in the process of setting up operations in Cameroon and South Korea.
Its products include a range of anti-bacterial and beauty soaps, fabric care cleaners, toothpastes and homecare cleaning products. Notable brands include include Freesia soaps and Rana detergent.
“The reason why Daraju chose Investec is because Investec comes as a very powerful alliance, which has an international and African flavour to it. It has an ability to invest in African companies, and they have a lot of experience in Africa,” said Daraju CEO Peeyush Garg.
“How Daraju can benefit is basically by the vast resources [Investec has], as well as the alliances they can bring on the table, improve our ability to spend on infrastructure as well as distribution in order to increase and grow our business.”
[DATA ILPR1:Investec] recently invested in food retailer OK in Zimbabwe and Big Media, an outdoor advertising company in Angola.
The African growth story continues to be a strong conduit for investment despite regions such as Latin America continuously growing as a major investment destination.
“We are an African business. The Investec Asset Management has its roots in Africa, started here and has then become an international player. With our roots so strongly here, we do look to invest in things that we know about,” Jennings explained.
“As a business we have, for a number of years, been investing across Africa in different ways. We think there’s a tremendous growth story for Africa. There are of course challenges to doing business across the continent, but over the last decade or so we’ve seen the real emergence of the Africa consumer.”
Areas such as the cell phone sector are a booming industry in the continent, and cell phone manufacturers are becoming increasingly innovative to better serve the African market.
“Nigeria as a market is extremely interesting. With 160 million odd people, Daraju’s looking to be in every household in Nigeria, providing them with basic products that people want but doing it in a way that’s affordable,” said Jennings.