PE & Fundraising

Gates, others seek answers to $1bn healthcare investment in Nigeria


February 22, 2018 | 1:44 pm
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Bill Gates, including other investors are currently questioning how Dubai-based private equity firm, Abraaj group have spent their money on healthcare delivery in Nigeria, India, Pakistan and Kenya.


In a coordinated audit by the investors carried out by accounting firm KPMG the funds were earmarked to build hospitals and clinics in  Nigeria and the other countries.


According to report, by last April, the fund had $545 million from investors which included The Bill & Melinda Gates Foundation, the International Finance Corporation, CDC Group and Proparco Group.


Months later, in September 2017, less than half of the investors’ funds had been spent, which prompted the four investors to begin requesting the fund’s bank statements.


Although it is reported that Abraaj voluntarily returning about $140 million to investors, but Gates and three others persisted in wanting an explanation, so in early February, Gates and others hired Ankura Consulting Group to perform a forensic audit to trace their money.


The Abraaj Group explained the lack of spending was due to delays on its intended projects which ranged in nature, including a new building code being introduced in the Pakistani city of Karachi.


“Some capital was not used as quickly as anticipated due to unforeseen political and regulatory developments in several of the Fund’s operating markets,” writes the group in a statement.


The fund said it had hit “roadblocks” in investments in Nigeria, Kenya, and Pakistan, with the delays communicated to investors, said a person close to Abraaj quoted by financial times.


“Given the lack of mature healthcare assets in growth markets and the need to develop greenfield as well as brownfield projects, capital deployment is less predictable than that of a standard private equity fund,” Abraaj Said


Founded in 2002 by Arif Naqvi, Abraaj has roughly $14bn in assets under management with most of its investments in Asia and Africa. Healthcare has been a growing area of investment and Abraaj has become one of the leading players in the sector in places such as Turkey and India where it has invested in some of the largest healthcare providers in the world.

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February 22, 2018 | 1:44 pm
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