Today’s Top Entrepreneurship And Business Stories (22 November)
Black Friday Sales Not Likely to Make A Significant Contribution To Economic Growth – Analyst
Black Friday sales are unlikely to to make a significant contribution to growth, says Thabi Leoka, Argon Asset Management’s economic strategist.
“Retail sales is not the driver of economic growth,” said Leoka in a Fin24 report. She went on to explain that if retail sales do pick up then that would be a sign that the economy is recovering.
Leoka added that Black Friday sales will not be as big as that experienced in the US. “Given what is going on in the economy, we do not expect it to be well received or as big as it was in the previous year.”
FNB senior economic analyst Jason Muscat in the same report says he expects Black Friday, as well as Cyber Monday to contribute to retail sales for the quarter.
Over the past three years, November retail sales have jumped at an average 8.4% month-on-month rate, compared to an average of 3.6% in the three years leading up to November 2011. This shows Black Friday has had a significant impact on sales, he explained.
“The problem, however, is that many people use the sale day to buy Christmas goods, which detracts from some of the typical December buying period,” said Muscat. This distorts quarter on quarter numbers as was seen this year where the first quarter’s retail sales contracted 5.9%.” (via Fin24)
Volvo To Supply Uber With Self-driving Cars
Swedish carmaker Volvo Cars said Monday it has signed an agreement to supply “tens of thousands” of self-driving cars to Uber, as the ride-sharing company battles a number of different controversies.
Volvo – which is owned by China’s Geely and has yet to build a self-driving system – said in a statement that it would supply Uber with “autonomous driving compatible base vehicles between 2019 and 2021.” Uber would then add its own software system to enable the cars to drive pilot-less.
When contacted by AFP, a Volvo spokesman did not specify the exact number of cars, but a source familiar with the matter said it could be around 24,000. Neither Volvo nor Uber released financial details but based on list prices for the cars the deal could be worth more than $1bn (around €850m).
“This opens a whole new segment for us. We are open to deliver to more taxi companies,” Volvo Cars CEO Hakan Samuelsson told Swedish financial newspaper Dagens Industri.
The deal builds on a non-exclusive agreement signed back in 2016 by Uber and Volvo, which is expected to release its first self-driving car in 2021.
The statement said that “Volvo Cars’ engineers have worked closely together with engineers from Uber to develop the XC90 premium SUVs that are to be supplied to Uber.”
The base vehicles “incorporate all necessary safety, redundancy and core autonomous driving technologies that are required for Uber to add its own self-driving technology,” the statement said.
Uber’s head of auto alliances, Jeff Miller, said the deal “puts us on a path towards mass-produced self-driving vehicles at scale.”
Vantage Capital Provides $12.5 Million Of Funding To Nigerian Property Development Company
Vantage Capital, Africa’s largest mezzanine fund manager, announced today that it has provided $12.5 million of funding to Purple Capital, a prominent Nigerian real estate company and financial service provider. Purple Capital is the developer of the iconic 6,000m² Maryland Mall, a neighbourhood shopping centre in the Ikeja district of Lagos.
The newly opened Maryland Mall offers one-of-a-kind experiences for adults and children, with over 35,000 visitors experiencing the mall’s varied attractions each week. Entertainment options include one of the only skating rinks in Lagos, a vibrant food court, restaurants and over fifty retail shops. The centre is home to leading multinational and local brands including Shoprite, Miniso, Uber, Genesis Cinemas, Stanbic IBTC and The Place. Maryland Mall is located on Ikorodu Road, one of the busiest thoroughfares in Lagos, and entices passers-by with one of the largest LED visual display screens in West Africa.
Purple Capital is headquartered in Lagos and has built a high-quality property portfolio, including upmarket residential estates in the Lekki suburb of Lagos.
Warren van der Merwe, Chief Operating Officer of Vantage Capital, said, “The Purple team epitomizes the best of Nigeria’s entrepreneurial spirit with its ability to navigate a demanding operating environment to create market-leading developments. Maryland Mall is one such development, a uniquely inviting family destination for Lagosians of all ages.”
Johnny Jones, Associate Partner at Vantage Capital, added, “Vantage is currently investing over fifty million dollars from its third-generation mezzanine fund in real-estate projects across Sub-Saharan Africa. We have reviewed over fifty real-estate opportunities since we launched our latest mezzanine fund but have only selected four to support. We are impressed with the Purple team’s cost-effective execution and believe their business is an excellent fit for our investment style.”
Laide Agboola, Managing Partner of Purple added, “’We are excited about Vantage Capital’s partnership with Purple on this refinancing and investment transaction which helps us reset, consolidate and gear up for exciting opportunities in the future. It also provides a seal of approval and increased possibilities for growth across our focus areas of financial services and real estate development.”
Obinna Onunkwo, Managing Partner of Purple also added, “Our focus on good corporate governance, high-quality deal origination and execution was a strong attraction for Vantage Capital as an offshore investor. Their investment acts as an enabler to our long-term growth strategy in Africa’s largest economy.”
The Purple investment is Vantage Capital’s sixth transaction in Fund III, a $280 million (R4 billion) fund, with a 55% allocation to countries outside South Africa. Purple Capital represents the 24th transaction executed by Vantage across three generations of mezzanine funds with aggregate capital deployed to date of $277 million (R4 billion).
Vantage was advised by Adepetun Caxton-Martins Agbor & Segun, one of Nigeria’s top commercial law firms known for its finance and cross-border M&A work, and Werksmans a leading South African corporate and commercial law firm. Purple Capital was advised by Bloomfield Law Practice, a ‘practical and hands-on’ Nigerian law firm with expertise in corporate commercial, private equity, real estate and financing matters.