Boutique financial services firm named to run Defence Industry Fund


A Johannesburg-based boutique financial services firm will manage and operate a Defence Industry Fund (DIF) to, among others, ensure easier access to defence markets for SMMEs (Small, Medium and Micro-sized Enterprises).

A joint statement, issued by Armscor chief executive Kevin Wakeford and Simphiwe Hamilton, his opposite at AMD (the SA Aerospace, Maritime and Defence Industries Association), has it that the soon-to-be established DIF has its origins in the Defence Review. This document was approved by Parliament just on three years ago after being commissioned in 2012.

The Defence Review, drawn up under the leadership of Roelf Meyer, sets out a long term strategic view of the capabilities needed by the SA National Defence Force (SANDF), among others.
“These capabilities would be acquired through a balanced combination of local and international defence companies,” according to the joint AMD/Armscor statement.

With the South African defence industry facing any number of challenges, including shrinking demand, export compliance requirements, high barriers of entry, lack of transformation and access to finance, it was decided to investigate establishment of a DIF.

The DIF would be owned and operated by a company complying with the requirements of the Financial Sector Conduct Authority (FSCA) with AMD and Armscor as catalysts for its establishment.

Starting with a Request for Information (RfI) in October last year and then a Request for Proposals (RfP) in November, 24 companies with 33 representatives attended a compulsory briefing session at the end of November. Nine – six local and three international – companies made RfI submissions and six local companies submitted proposals as part of the RfP process. Of the six, two were disqualified and four were evaluated in a two-stage process – technical evaluation of submissions and presentations.
“The successful bidder was Crede Capital Partners (Pty) Ltd and the joint boards of Armscor and AMD have appointed the company to initiate the operationalisation of DIF in line with the FSCA requirements.
“The establishment of the DIF is considered a significant step towards the support and transformation of the defence industry, especially SMMEs operating in the defence environment,” the joint statement said.

According to its website, Johannesburg-based Crede Capital Partners is “a boutique financial services firm with a core focus on assisting clients in capital raising, deal structuring, project development, risk and investment advisory”.

It is staffed by professionals with “diverse academic qualifications and experience in fund management, private equity, corporate and project finance”. Included in Crede’s client list are private and public companies, public sector institutions, fund managers, life companies and family offices.

Its focus areas are real estate, agriculture, financial services, manufacturing, power and infrastructure.