ECP sells stake in African rubber company for €35.7 million

Washington, DC -- Emerging Capital Partners Llc (ECP), an international private equity firm has sold its shares in Société Internationale de Plantations d'Hévéas (SIPH), Africa's leading natural rubber producer and exporter for $48.9 million (€35.7 million).

EPC bought the shares through the AIG African Infrastructure Fund L.L.C. for $14,8 million in March 2005, and in just over two years has more than tripled its initial investment.

"Our exit from SIPH exemplifies how the African agribusiness sector is becoming more attractive for private equity investment, as the continent has a comparative advantage in the production of many agricultural products," said Vincent Le Guennou, executive vice president of ECP, in a 23 July statement.

"Through the implementation of leading edge agricultural techniques - and by establishing the right partnerships and management team - the company's revenue grew by 44 percent annually over our two-year holding period," he added.

With production in excess of 92 000 tones, SIPH is Africa's leading rubber exporter through its two majority-owned subsidiaries: Ghana Rubber Estates Ltd. (GREL) in Ghana, and Société Africaine de Plantations d'Hévéas (SAPH) in Côte d'Ivoire.

SIPH has developed a strong partnership with Michelin has been technical operator of both SAPH and GREL since 2003 and in 2006, ECP assisted in the acquisition of Michelin's rubber plantations in Nigeria in exchange for Michelin taking a 20 percent stake in SIPH.

"SIPH is a well-governed company with a world-class partner in Michelin," said Hurley Doddy, chief operating officer, in the statement. "ECP helped it to negotiate successfully with Michelin, implement standard financial reporting, and identify appropriate acquisition targets." ss

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Press release from ECP