Fieldstone Newsletter - October 2020

Dear Clients and Friends of Fieldstone,

At the outset, I suggest we banish all talk of what is normal and what is not and what is virtual and what is not. Let us talk about life as we encounter it and leave that other talk to so-called “webinars” (someone must think of a better name for those things). 

Our work here at Fieldstone continues to be active and productive. There have been significant changes, but change is a constant in both easy and difficult times and there are some interesting things that have happened, are happening and will happen – which will be the substance of this newsletter.  Without further ado, let us jump into the most relevant topics.  

  • Fieldstone announces the launch of a new initiative to deliver world-class advisory services focusing on infrastructure and PPP in South Africa.  We expect this to be a key priority in South Africa as the country “rebuilds better” post-Covid.  The South African activity complements Fieldstone’s governmental advisory work elsewhere in Africa with such major players as USAID, the African Development Bank and the United Nations Economic Commission for Africa, that has become a cornerstone of the practice. 

    The initiative will be led by Mahlatsi Movundlela in the role of Director : Infrastructure & PPP South Africa. 

    Mahlatsi is the founder of M Consulting, an audit partner at MJM & Huruma Incorporated and Chairman of Mine Restoration Investments. He brings financial and best practices expertise for large corporations and the public sector. He is a chartered accountant and entrepreneur with more than 17 years’ experience in the financial services sector including audit, capital raising, transactional advice, management consulting and financial management. Mahlatsi will continue in his capacity as Chairman of M Consulting. 
Mahlatsi Movundlela
Mahlatsi Movundlela
  • Fieldstone is aligning with Finnacle Capital Advisors in India. We have had a long-term goal of returning to India and Asia with a permanent presence and this is a major step in that direction. Our partner is led by Fieldstone alum Shubhomoy Ray, who founded the firm in 2007. Finnacle has established a strong record in energy and corporate advisory work in the subcontinent and throughout Asia since that time. They have worked with private clients and development finance entities including the World Bank, the Asian Development Bank and the International Finance Corporation. They have established a reputation for top-flight modelling and careful, thoughtful advice, so the decision to proceed with them was not difficult. Uttara Menon has been dedicated as a “bridge” to forge this association.  She has 12 years of experience in modelling and structuring transactions and is a principal in Finnacle.  We find this move particularly timely as the interaction between African and Indian capital and expertise has only increased and our global clients have spotted the transition to green energy in India as a unique opportunity of scale.
Shubhomoy Ray and  Uttara Menon
Shubhomoy Ray and Uttara Menon
  • Fieldstone continues to advance its work with FONSIS, the Sovereign Wealth Fund of Senegal, as the financial advisor and co-manager of the Renewable Energy and Energy Efficiency Fund (REEF). The fund is targeted to close in the first part of 2021 with a target first raise of €109 million. The program aims to make renewable projects in the West African Economic and Monetary Union countries more accessible to local financial participation by limiting debt and extending tenors through provision of competitively priced mezzanine financing. The goal is to spur over 280 MW of renewable investment in the coming years.
  • Nigeria is a challenging market – but a look at the statistics and its position in Africa today and (especially) in the future, suggests it is a most important place in which to operate and to get right. Accordingly, Andrew Smith-Maxwell (our Chairman and also a Board Member of Nigeria’s Honeywell Group) has recruited Adebola “Bola” Enikanoselu as a Senior Banker in our London office, where she is relocating with her family. Andrew has had the privilege of working with Bola for the past seven years in Lagos for Honeywell, so the interview related to her capabilities was blessedly short. Fieldstone continues its work on a number of projects in the country including a soon-to-be-announced transaction in commercial and industrial energy generation and a promising renewables project. We will report more on both in the newsletter at year end. A resolution to Nigeria’s domestic energy challenges will require a combination of tried-and-true structures and novel approaches.
Adebola "Bola" Enikanoselu
Adebola "Bola" Enikanoselu
  • We are pleased to announce our renewed collaboration with Clarence Oelofse, a former managing director and 16-year veteran of Fieldstone as Senior Banker. Clarence is working with us on select mandates, including emergency power in South Africa. He will continue to assist various clients such as the USAID's Power Africa initiative for Southern Africa as Lead Transaction Advisor and Exxaro Resources, independently. Clarence has an MBA and a degree in electrical engineering, with transaction/financial advisory experience in every form of generation, except nuclear, covering markets from South Africa to Ethiopia. 
Clarence Oelofse
Clarence Oelofse
  • Fieldstone Africa Investment Resources (FAIR) is finalizing its incorporation in the Netherlands and should be ready with its new ownership configuration next month. Historically, FAIR has been focused on things outside of South Africa but has newly positioned itself in a number of local South African projects. The opportunity and need in the South African market is exceptional, so we have to wish all development groups (and the decision makers who will green light development) the wisdom to recognise what is to be done without delay. Every utility system in the world is in the midst of revolutionary change, so maintenance of the status quo is not an option anywhere and proactive response is a needed assistance to the macro-economy in each instance.
  • The London team led by Cornel Chiriac is focused on the development of new energy technologies. This part of the industry sees change that is both fast (the developments outpace one’s assumptions about what might be done) and slow (insofar as technology acceptance means convincing industry incumbents that something they do not know will change things). Part of that conundrum is indicated in our work with Bombora, an Australia founded business based in Wales, that has developed a new form of wave generation technology. Even during the course of our representation, the company has proceeded to take further substantial steps in honing its application.

    Bombora’s solution is radically different than its wave power predecessors in terms of cost and durability of the kit. The new application is that the Bombora technology can be co-located with offshore wind turbines, increasing the efficiency of those wind farms. All of this is particularly relevant with the offshore wind industry projected to add over 200 Gigawatts of capacity worldwide by 2030 including several Gigawatts of floating wind generation systems (according to the GWEC). Forecasts on this subject have actually increased during troubled 2020. Tomorrow has clearly already started today.

 

Bombora Technology
Bombora Technology
  • Finally, in a world without conferences, Karim Palmieri spoke on a panel at one – and even in person (against the advice of the Chief Executive). The Barcelona New Economy Week addressed the shifting landscape and shape of recovery in infrastructure in Europe, particularly ports and logistic centres. The conference concluded that many things will change quickly: shorter and altered supply lines, autonomous energy supplies for industrial and logistics zones and increased application of technology in greener and more sustainable solutions.

    The conclusions resonate when we think about the prospects for Africa. Through all the travails of the last year, there is an opportunity for Africa to emerge stronger after the immediate shock of the crisis. A reshuffling of the cards and reevaluation of how and where to produce goods for the global market in a sustainable manner is a chance for African economies to realize their potential. The economies of the Continent can further integrate in the global market as more than providers of raw materials. Lower costs, proximity to supply sources and demographics (as producers and consumers) stand as built-in advantages.


With that positive thought in mind, I look forward to communicating again before the end of the year about further news and developments at Fieldstone.

I encourage you all to stay safe and press on – there is a lot to do and time is one of our most precious commodities.

Best,
Jason Harlan
Chief Executive Officer