Alterra Capital Partners, an Africa-focused private equity firm that backs high-growth companies, acquired a significant stake in a South African beverage company, in partnership with two co-investors.
In a first deployment from its $400-million target fund, Alterra has picked a majority stake in Stellenbosch-headquartered beverage innovator Chill Beverages that owns the premium mixer brand Fitch and Leedes, buying from Old Mutual Private Equity.
The PE firm led a consortium of investors that includes South Africa’s investment holding company Mineworkers Investment Company (MIC), and Rwanda-based PE firm Admaius Capital Partners.
Besides Fitch & Leedes, Chill’s range includes Score energy drinks and Chateau Del Rei sparkling wine. With manufacturing facilities in Gauteng and the Western Cape, Chill has delivered historic growth of over 20% per annum, according to the company.
The investment by the Alterra-led consortium would facilitate additional marketing spend on Chill’s brands, besides an increased focus on developing a wider Gauteng distribution network and investment in new product development to expand its product range.
Alterra Capital Partners raised $140 million in the first close of the Africa Accelerators Fund to invest in companies in retail, telecommunications, technology, financial services, consumer products and services, and infrastructure and logistics sectors. It is backed by Norfund, Standard Bank Group, World Bank’s private investment arm International Finance Corporation (IFC), Germany’s Deutsche Investitions- und Entwicklungsgesellschaft GmbH, and Allianz SE’s AfricaGrow fund.
The Chill deal marks the fifth deployment from Admaius’ $250-million maiden fund. Its other portfolio companies include an Egyptian pharmaceutical company Parkville, a Rwandan telecom tower infrastructure company TRES infrastructure, Tunisian salted snacks player Céréalis, and Africa’s largest digital payments network MFS Africa.
Anchored by the Qatar Investment Authority (QIA) and Rwanda Social Security Board (RSSB), the Kigali-headquartered pan-African focuses on sectors that contribute to economic and social development in Africa, including digital infrastructure, financial services, fast-moving consumer goods (FMCG), healthcare, and education.
“On behalf of the Alterra Consortium, we are very excited to be investing in Chill Beverages. Energy drinks is the fastest-growing beverage category in South Africa and Score is a significant player in this market. The recent launch of Chateau Del Rei has been very successful and its potential is enormous,” said Bruce Steen, partner at Alterra. Alterra Capital Partners was formed in 2020 by former Carlyle Group employees, Genevieve Sangudi, Eric Kump, Idris Mohammed, and Bruce Steen.
Meanwhile, MIC’s CEO, Mary Bomela, said the investment represented an attractive growth opportunity. "MIC has maintained a keen interest in investment opportunities within the food and beverage sector. We are pleased to be part of the team supporting a bourgeoning South African beverage company in Chill,” said Bomela.
Debt financing for the transaction is being provided by Standard Bank and RMB. Advisors on the transaction included Webber Wentzel, Cliffe Dekker Hofmeyr, and ENS on legal, as well as EY on financial due diligence.
