Afsar Ebrahim: East Africa is poised to attract major interest from foreign investors

Having served as the Deputy Group Managing Partner in an international accounting firm, Afsar Ebrahim has now founded a boutique advisory firm, KICK Advisory Services, born of his 30-year experience in the financial consulting domain. We speak to him to understand what motivated him to start this venture, which is likely to prove a major pillar of support to corporates as they seek specialised partners to improve their liquidity and restructure their balance sheets to strike the optimum balance between debt and equity in a post COVID-19 context. Moreover, with his vast experience of working with countries in East Africa, Afsar notes that KICK is in a unique market standing to help clients expand into these growth economies which are well positioned to attract major interest from foreign investors. Edited excerpts:

1. What motivated you to start KICK Advisory Services?

There was a gap in the market requiring a specialised firm offering be-spoke solutions that can create value for shareholders. Mauritius as an IFC of substance needs more specialists to broaden the service offerings to international clients. Also, the current volatility in the economic environment means that CEOs need a lot more focused assistance to be able to deliver on their agenda. All these factors have motivated the setting up of KICK Advisory Services.

1. What is the range of solutions that KICK Advisory Services offers in the corporate finance space?

We offer the following solutions in the corporate finance space:

• Valuation  
• M & A Advisory     
• Fund raising          
• Working Capital Requirements    
• Strategic Consulting          
• Business Restructuring Services   

1. Do you feel that the current context of volatility and uncertainty facing businesses – with liquidity problems and cash flow issues unfortunately becoming the norm – calls for a greater emphasis on corporate finance, and restructuring solutions in particular?

The current volatility and lack of visibility oblige businesses to focus on their financing. Obviously, there is a liquidity crunch which is a short-term challenge but the overall climate warrants a holistic approach to an optimum capital structure. This requires careful evaluation of the cost of equity against the cost of debt, more so given that the cost of debt is currently at its lowest level. However, the financial risk associated with debt remains as high as it has ever been because of stringent regulations. Hence, the need for an intelligent approach to equity, bearing in mind the trade-off between cost of equity and cost of dilution. 

1. The business name ‘KICK Advisory’ conveys a sense of dynamism, with ‘Ensure our clients kick themselves from good to great’ being your corporate tagline. How will you ensure that your business lives up to this dynamic and visionary tagline?

KICK is the enabler to score, the enabler to win and to get results. The colors of KICK reflect the colours of victory – it is indeed no coincidence that our colours are similar to those of MAN United. 

We ensure our clients kick themselves from good to great and we shall make a positive difference with our commitment, passion, integrity, honesty and, finally, the personal touch that we bring to all our endeavours.

5. KICK Advisory will offer corporate finance solutions to firms wishing to establish themselves in India, Dubai and Africa. What are the key reasons behind the focus on these three geographies?

We have an extended network with sustainable knowledge and experience of the market in various continents. Therefore, we are well-positioned to accompany our clients to expand their business, be it in Africa, India or Dubai. We are looking at cross border transactions and we firmly believe that outbound investments into Africa will accelerate. There is a lot of capital available with funds that are located in Dubai which are Africa-focused, and we intend to tap into these funds.

1. In particular, with Africa being one of the few regions globally to have been somewhat spared the worst of the COVID-19 crisis courtesy of its youth demographic dividend, how is KICK Advisory Services positioning itself to target firms from the continent?

My track record in Advisory has been primarily been in East Africa and it’s an environment which is going to attract major interest from foreign investors. So, KICK has been positioned through its strategic alliances to take advantage of these opportunities by leveraging on this robust network.

1. Finally, what would be the main insights you would like to share with businesses that are struggling with cash flows and contemplating engaging experts to support them on the corporate finance front? 

First and foremost, companies in difficulties should not hesitate to invest in securing the services of professional advisers who are experienced in turnarounds.  The current situation requires a different mindset to be able to come up with innovative solutions.  

In addition, no business operates in a vacuum and with Mauritius being an export-oriented economy, be it for goods or services, it is imperative that both clients and advisors are very much aware of the international context. 

Finally, those who are struggling should focus on deleveraging their balance sheets and even if this means dilution so be it as it will create much better value down the line.  The solution to many of the current challenges is equity as opposed to debt. We must bear in mind that only the State can borrow without limit as it can always print money as a last resort, a privilege not available to corporates.

Resources :    platformafrica.com