Abraaj sells stake in Latin American grocer to Los Angeles private equity firm

The holding company divested its stake in the Latin American discount chain, which has grown to 500 stores from 40 stores when Abraaj made the investment in 2010.

Abraaj Group exited its investment in the Latin American grocery store operator Koba International Group.

It sold its stake to the Los Angeles private equity firm Capital Group Private Markets, which made the investment through its US$3 billion Capital International Private Equity Fund VI.

The Dubai buyout firm declined to disclose the sale price. Abraaj made the exit through its Aureos Latin American Fund I, which invests in Mexico, Colombia and Peru.

“The economies [of Colombia, Mexico and Peru] have proven resilient, [and] are shaped by strong fundamentals and an increasingly consumptive middle class,” Daniel Wasserman, the managing director of Abraaj Group in Colombia, told The National. “We continue to see compelling investment opportunities in high-growth, mid-sized businesses in the consumer sector – and these are investments that we will pursue as part of our strategy for the region.”

Koba operates the D1 chain of supermarkets in Colombia. It is a hard discount retailer usually located in densely populated areas in middle-income neighbourhoods, selling goods below the market price.

Abraaj invested in Koba in 2010, when Koba had 40 stores. Koba now has about 500 stores and more than 5,000 employees.

The Dubai company entered Colombia, Mexico and Peru in 2008 with investments in sectors such as retail, tourism, technology, food and beverage and consumer goods.

Koba is Abraaj’s fifth exit from the fund. Last year, it sold its stake in Condor Travel in Peru to the US private equity firm Carlyle Group.

In March Abraaj invested in the Indian online grocer BigBasket and launched a US$526 million in July fund to tap Turkey’s economic potential.

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Published: September 13, 2016 04:00 AM

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