TONY O. ELUMELU, MFR

A Brief Profile

1.Tony O. Elumelu is the Chairman of Heirs Holdings Limited, an African investment company
committed to economic transformation in Africa through long-term investments that
generate economic prosperity and social wealth.

2.  He is also Founder of The Tony Elumelu Foundation, an Africa-based and African-funded philanthropy, whose mission is to identify and groom African business leaders and entrepreneurs to achieve the Foundation’s central objective of enhancing the competitiveness and growth of Africa’s private sector.

3. His reputation as a prominent African business leader is founded on his vision and strategy for United Bank for Africa Plc (UBA), a single country bank he transformed into a Pan-African financial services institution serving over 7 million customers in 20 African countries and operating in Europe, the Middle East and the United States. He retired as Group Chief Executive Officer of UBA in August 2010.

4. This year, New African magazine named him one of the Top 100 Most Influential Africans in the area of business and finance.

5.More recently, he was appointed as Chairman of Transnational Corporation (Transcorp), a diversified conglomerate with strategic investments  and core interests in the hospitality, agribusiness and oil and gas sectors.
Source: Heirs Holdings Ltd

Tony O. Elumelu, the  Chairman of Heirs Holdings Limited, an African investment company, was in Kigali recently as part of the Nigerian delegation that was exploring ways of strengthening of trade and investment ties between Rwanda and Nigeria. In this exclusive interview Mr. Elumelu talks to Fred Oluoch-Ojiwah of The New Times on his impressions on Rwanda’s investment landscape.

Excerpts

What is your first impression of Rwanda?
It is a good impression, and it is evident that this is a country undergoing a significant transformation. Like many African countries, Rwanda has had periods of crisis in its history – in your case, more tumultuous than most – but I see encouraging signs of consensus building and a shared vision of the future.

That is always encouraging as building a shared vision for a country’s future is no easy task, even when there has been no violent crisis.

Rwanda is hungry for investors like you to make a difference – when did you first hear about its investment opportunities?
It is heart warming to hear that Rwandans are keen and encourage investment in their country.

It means they are economically literate people! (Laughs)Seriously, I view Africa (particularly sub-Saharan Africa) as a single large market with some variations but with quite a number of common features.

My experience also shows that success in a particular country can often be replicated in other geographies (again, with a few modifications).

That is primarily why we have been focused and intend to continue to focus on all attractive African sub-markets.We started looking closely at opportunities in Rwanda after we accompanied Professor Michael Porter, the global expert in competitiveness and advisor to President Paul Kagame,on a visit to the country in August.

Since then, we have been in discussions with the Rwanda Development Board and the Private Sector Federation to better understand the market and the kinds of opportunities available.

How do you invest in such a market?
(Laughs) Investing is a process, so we must maintain the discipline to adhere to investment guidelines. That doesn’t mean being excessively rigid but it does mean being disciplined.

The experience of investing in countries at similar stages of development also helps. We look for opportunities that make good investment sense, and if there is an alignment of objectives, we invest. Our investment philosophy is longterm so we like to do investments in businesses that have a sustainable business model and where the parties have a long-term mindset.

Of course, we would run a proper due diligence and investment appraisal process but it is really not different from the way we invest anywhere else.In terms of process, we have a Chief Investment Officer (CIO) at Heirs Group, and we have an Investment Committee. 

Once a transaction is identified and signed off by the CIO, it goes to the Investment Committee for consideration.

What would you advise Rwanda’s budding entrepreneurs?
Build a good team. Stick with it! Identify your purpose, articulate it clearly, build a good team, have the right governance philosophy, quickly institutionalise your business to remove key man risks, and stay focused. 

Also, consider your market to be beyond just your country.  Look to East Africa – then all of Africa – so that growth potential is almost unlimited.

If conditions were ripe and everything was set, how much would you invest in Rwanda now and in what sectors?
(Laughs again) We don’t operate in that manner although I understand where you are coming from. Most investment managers in the Western/developed world will tell you that they have allocated up to, say, $100 million for emerging markets and will then go about deploying that capital over a long period of time.

At this stage, we are more opportunistic and flexible than that. If the right opportunity presents itself and is exceedingly attractive, we will deploy the necessary capital required and won’t restrict ourselves in the manner that I have just described.

With the looming Euro zone crisis, what is your advice to African political leaders and technocrats?

Be watchful. Don’t be complacent. Invest in your people and infrastructure. Adhere to principles of good governance. Think long term and stay focused.

How can countries such as Rwanda contribute to the idea of an African renaissance?
There is no magic formula, in my view. It’s a bit like revising for exams as a student. The most conscientious students who prepare well and have a hunger for learning tend to get the best results.

I have always thought companies and countries should adopt the same principle.Our political leaders should begin to run state affairs as we do in the private sector. 

Performance, accountability, and good governance are key ingredients for success.

Which areas does Rwanda need to work on in order to make it more competitive?
My answer won’t be unique to Rwanda as many African countries have similar challenges. Again, it is about creating an environment in which all Rwandans have confidence.

Things won’t ever be perfect, but people must see clear evidence of improvements that reinforces the credibility of the country and its people. In summary, it is all about building confidence in the country, in its people and being committed to getting things done more easily and efficiently over time.

It means focusing on hard things like good roads and clean water and softer things like improving education, providing healthcare for people, and an adherence to rules of engagement and health. I think Rwanda, though, is totally on course.

Share with us your vision of the kind of intervention your business ventures would want to undertake in Africa?
Our areas of focus are financial services, healthcare, hospitality and real estate, natural resources (including agriculture) and infrastructure; all the areas we believe Africans need and will continue to need as economies and living standards improve.

We also invest along the different stages of the investment lifecycle. We are keen on making investments that bring positive change and enhance economic prosperity – investments that really add value financially and socially.

I believe in the philosophy of Africapitalism, which is about private sector-led investments that generate economic prosperity and social wealth for all Africans.

Ends