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Transaction/Case Details

Fairfax Africa Holdings completes IPO, Concurrent Private Placements and AFGRI Transaction for a total of US$500M

DATE CLOSED

February 17, 2017

BUSINESS SECTOR

Financial Services

LEAD OFFICE

Toronto

VALUE

500 Million USD


OVERVIEW

On February 17, 2017, Fairfax Africa Holdings Corporation completed its initial public offering of subordinate voting shares for gross proceeds of approximately US$56 million. Concurrent with the closing of the IPO, Fairfax Africa issued multiple voting shares on a private placement basis, in the amount of approximately US$227 million to certain affiliates of Fairfax Financial Holdings Limited. This investment, together with the contribution to Fairfax Africa by Fairfax Financial of its indirect interest in AFGRI Proprietary Limited in connection with the AFGRI transaction described below, resulted in an aggregate investment by Fairfax Financial of US$300 million in multiple voting shares. Also, concurrent with the closing of the IPO, Fairfax Africa completed its acquisition of an indirect 42.2% interest (including the indirect interest formerly held by Fairfax Financial) in AFGRI, a leading agricultural services and food processing company based in South Africa. Further, concurrent with the closing of the IPO, Fairfax Africa issued to certain cornerstone investors subordinate voting shares, on a private placement basis, for aggregate gross proceeds of approximately US$144 million.  As a result, the combined gross proceeds was approximately US$500 million.

On March 2, 2017, Fairfax Africa issued an additional 408,000 subordinate voting shares pursuant to the exercise of the over-allotment option granted to the underwriters in connection with the IPO for additional gross proceeds of approximately $4 million.

Fairfax Africa is an investment holding company whose investment objective is to achieve long-term capital appreciation, while preserving capital, by investing in public and private equity securities and debt instruments of African businesses or other businesses with customers, suppliers or business primarily conducted in, or dependent on, Africa.

McCarthy Tétrault LLP advised Fairfax Africa and Fairfax Financial with a team that included Deandra Schubert, Andrew Parker, David Tennant, Jeremy Pleasant, Mark McEwan, Shauvik Shah (Corporate/Securities) and Stefanie Morand (Tax).

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Related Area of Expertise


Africa
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Capital Markets
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Financial Services
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M&A
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