About ARVF II
ARVF II is a private-equity fund investing in Africa, with a focus on fast-growing SMEs in East Africa. The fund focuses on majority or large minority growth capital and buy-out capital investments in Africa (Ethiopia, Kenya and Uganda, with opportunistic investments in Tanzania and Rwanda). The fund is managed by Ascent Capital and has reached its final closing in July 2022, with a total size of USD 128m.
About Ascent Capital
Ascent Capital is a fund manager in East Africa. Ascent counts with a strong track record in various industries including manufacturing, consumer goods, healthcare and financial services.
Founded in 2011 by Malian entrepreneur Houd Baby, Groupe Sahel has quickly become a key player in cereal processing in the Sahel region. With a production capacity of 600 tonnes per day through its subsidiaries in Mali, Burkina Faso and Niger, the Group is the only player in the region producing in three different countries. Groupe Sahel has drawn on its local roots and experienced management to build strong brands, such as Lafia, its flagship brand in Mali.
This operation combines the local expertise of Groupe Sahel with the century-old know-how of the Moroccan leader Forafric. This new partnership will enable Forafric to expand in West Africa, while strengthening Groupe Sahel’s production capacity and diversifying its product offering. Together, Groupe Sahel and Forafric aim to play a leading role in addressing the growing food demand in the Sahel.
About Groupe Sahel
Groupe Sahel is a company founded in 2011 and specialised in the processing of cereals. The Group operates in Mali, Niger and Burkina Faso and aims to expand in other West African countries under the brand LAFIA with its slogan “Feeding Africa together”.
About Forafric
Forafric, founded in 1926, is a leading agribusiness company in Africa with activities in Morocco and sub-Saharan Africa. With 12 industrial units and two logistics platforms, Forafric is the largest milling company in Morocco, producing a complete range of flour and semolina, as well as transformed products such as pasta and couscous. Forafric exports to more than 45 countries. Pursuing ambitious expansion plans in both Morocco and sub-Saharan Africa, the Group is playing an increasing role in fulfilling Africa food security needs.
Bringing Africa’s economies closer together: Groupe Sahel’s equity raise and the takeover of Morocco’s Forafric group
A succession story
Founded in 2011 by Malian entrepreneur Houd Baby, Groupe Sahel has quickly become a key player in cereal processing within the Sahel region. With a production capacity of 600 tons per day and subsidiaries in Mali, Burkina Faso, and Niger, the group stands out as the only regional player operating across three different countries. Leveraging local roots and experienced management, Groupe Sahel has built strong brands, including Lafia, its flagship product in Mali. To support the next phase of scale and governance transition, the group engaged Enexus as financial advisor for an equity capital raise.
Founded in 1926, Forafric is a leading agribusiness company in North Africa. With seven industrial units, Forafric is Morocco’s largest milling company, producing a comprehensive range of flour and semolina, as well as processed products such as pasta and couscous. With only a limited presence in sub-Saharan Africa, Forafric had been seeking the right opportunity to launch its ambitious long-term African investment strategy.
To consolidate Groupe Sahel and address succession planning simultaneously, Mr. Houd Baby’s intentions provided Forafric with an ideal opportunity. As a result, Forafric completed majority investments in 2021.
Multiple objectives for a complex transaction
This transaction combined capital infusion—to restructure debt and finance a capex plan—with a succession solution. Control was transferred to Forafric, while Mr. Baby remained involved in governance as a minority shareholder. Structuring the deal to align interests, prioritize company needs, and address the complexities of an unstable Sahelian environment made this transaction both unique and challenging. It also illustrates how growth capital can work alongside strategic mergers and acquisitions to secure continuity while enabling expansion.
A major transaction for food security in the sahel
Ensuring food security is essential for countries in the Sahel. For decades, demand for cereals has grown steadily, driven mostly by demographic expansion. Regional millers must reach critical size to benefit from economies of scale and diversify their product offering. This transaction positions Groupe Sahel to achieve that scale. By combining the financial strength and expertise of a leading Moroccan company with the agility and local market knowledge of a regional miller, this partnership represents the right formula for building a regional champion.
