African PE at a Crossroads: Managed Solutions for End-of-Life Vehicles
Africa’s private equity industry is at a pivotal moment. Many first and second-generation funds sponsored by local or regional managers, with capital commitments from Development Finance Institutions (DFIs) and global LPs, are now reaching the end of their lives. While some have delivered impact and returns, others are stuck with unsold assets, inactive GPs, and mounting frustration among investors.
Why has this happened? Several structural challenges are at play:
- Local operating environments are complex and volatile
- Exit opportunities are limited
- GPs often lack resources or motivation as carry becomes unachievable
This creates a challenge for LPs: do they continue to hold in hope, or act decisively to recover what value remains?
Cork Gully provides a third potential path: a tailored, hands-on approach to fund wind-downs – integrating sub-advisor services (or GP replacement if so required), asset sales, and LP position transfer – through a structured exit management service.
Our approach includes:
- Assessing fund portfolios with our team of experienced partners to determine realisable value
- Engaging with GPs and LP Advisory Committees (LPACs) to evaluate GP performance and options for replacement
- Navigating local legal and regulatory frameworks to assume control where necessary
Replacing the GP, acquiring the GP’s stake, or buying LP positions in liquidating funds with a clear exit plan can all be viable strategies. What is crucial is tailoring the approach to local realities, understanding political risk, deal execution constraints, and asset-level complexities.
Our local networks, strong relationships, and strategic partnerships enable us to implement these solutions in a transparent, disciplined manner.
For DFIs and institutional LPs, a managed exit may offer:
– Faster return of capital
– Better governance of the remaining exit process
- Independent asset valuation
- Regular reporting
- LPAC oversight of the process
– A reduction in administrative drag from legacy funds
African private equity holds long-term promise. However, for many existing vehicles, that promise is tied up in unresolved exits. Cork Gully offers LPs a credible way forward: unlocking value, achieving closure, and helping to restore LP confidence and capacity for future regional allocations.