🍞 The Patient Owners

Hello, this is Demilade.

I’m currently reading “Ride of a Lifetime”, Bob Iger, the former CEO of Disney, a career-focused autobiography. It’s an easy and entertaining read so far. I’m currently at the point where Bob decides to join Disney, following its acquisition of ABC. This section is important to me because of the backstory of that deal. ABC, one of the largest television networks in the country, had been bought a few years earlier by a comparatively small company called Capital Cities. They had grown from buying regional newspapers to cable channels and, with the help of capital from Warren Buffett, acquiring the much larger ABC.

Under the 30-year management of Tom Murphy, $1 invested in Capital Cities would be worth $204, compared to $48 for media peers, and ~$17 for S&P 500 (12x). Buffett’s own investment in the company. grew 6x between when he helped them by ABC, and 10 years later when they sold the entire business to Disney.

Capital Cities and Buffett’s own Berkshire Hathaway ran businesses in a radical way. They believed that businesses were created to generate cash flow, and the goal of the CEO was to allocate that cash into more cash-generating activities. Your ability to do this over a long period of time is what brings value to a business. The CEO was, in effect, an investor of the company’s cash.

This simple idea, taken very seriously, is what makes Berkshire Hathaway one of the most successful compounders of capital in modern history, and what made Capital Cities one of the most successful media stories in US history.

There is a Nigerian company following this same path, and it’s already yeild fruit (and a lot of cash). Today, we tell the story of Themis Capital and their acquisition of UAC, turning one of Nigeria’s oldest conglomerates into the Berkshire Hathaway of Africa.

As usual, if you enjoy reading these, please forward to one person.

P.S. We have sponsors now!

Best
Demilade

In February 2018, UAC of Nigeria Plc raised ₦15 billion from shareholders through a rights issue at about ₦15.70 a share. One of the buyers was Themis Capital Management, a Lagos-based investment firm barely a year old. By the end of that year, it owned 232.3 million UAC shares, just over 8% of the company. Themis kept buying as the shares fell, through a pandemic, two devaluations and a cost-of-living crisis, building a stake of 657 million shares, worth about ₦119 billion, or $89 million, today. Over 10x returns in naira or about 4.5 times in dollars, roughly 23% return per year.

Themis Capital Management was founded in Lagos in 2017. By the end of that year it had already held 74.1 million UAC shares. There is no public record of any significant Themis investment outside UAC. The firm describes itself as "concentrating capital and talent on high-potential opportunities in Sub-Saharan Africa". My assumption is the strategy from day one was to pour private capital into a holding company vehicle on the stock exchange, which turns term-dated capital into a permanent capital vehicle. I.e its private investors could now hold UAC shares and offer liquidity whenever they needed it.

The company is run by;

Folasope "Fola" Aiyesimoju is the founder and the operator. He graduated from University of Lagos adn is a CFA charterholder. He worked at ARM Investment Managers, the premier Asset Management Firm in Nigeria and Ocean and Oil Holdings, Standard Bank, then five years leading Stanbic’s M&A advisory business. There he worked on the €120 million sale of Fan Milk, a West African frozen dairy brand, to Danone and Abraaj in 2013. He then joined KKR to work on African private equity. And co-founded Foodpro, a nut-based snacks business.

Khalifa Biobaku brought the public markets experience. For almost a decade he was co-managing partner of Blakeney Management in London, one of the oldest institutional investors in Africa and the Middle East, with more than $2 billion under management, after stints at Goldman Sachs, Morgan Stanley and Davidson Kempner. He also founded Dalio Property Development, which has held more than 5% of UAC in its own right.

Peter Mombaur brought the long-horizon model. A former McKinsey consultant who spent seven years in Nigeria, he ran Africa Holdings for E. Oppenheimer & Son, then became co-managing director of Tana Africa Capital, the evergreen investor set up in 2011 by the Oppenheimer family and Singapore's Temasek, with about $600 million raised and no fixed exit dates. He co-founded the African Leadership Academy in Johannesburg with Fred Swaniker and Chris Bradford, and now runs Terra Education in San Diego.

Together, the backgrounds explain why UAC became the target company. Aiyesimoju knew UAC's categories: UAC owned Supreme Ice Cream, a rival to the brand he helped sell. Biobaku knew how to price African listed equities. Mombaur had seen permanent capital at work.

UAC was an odd prize. The United Africa Company grew out of 19th-century trading houses, spent decades inside Unilever and was Nigerianised after independence. By the 2010s it was a sprawling conglomerate: Gala sausage rolls sold in Lagos traffic, Supreme Ice Cream, Swan water, the iconic Mr Bigg's, Grand Cereals, Livestock Feeds, CAP paints, MDS Logistics and UPDC, a property developer.

The initial share purchase came through the February 2018 rights issue, which offered one new share for every two held and lifted UAC's share count from 1.92 billion to 2.88 billion. Themis took its stake from 74.1 million shares to 232.3 million. In March 2018, Aiyesimoju and Olufunke Ighodaro joined the board with Mombaur as their alternate.

At the same time, two trading vehicles of Blakeney, the London firm Biobaku co-ran, held another 385.2 million shares, or 13.4%. Together, the Themis and Blakeney positions came to about 21% of UAC.

Themis kept buying as prices fell. UAC's year-end share price fell from ₦9.75 in 2018 to ₦7.25 in 2020. Themis's holding rose to 279.4 million shares by April 2020 and 334.5 million by March 2021. By the end of 2024, Themis held 586.3 million shares and AM&P an affiliated company, another 70.8 million, 22.5% of the company between them. Biobaku joined the board in March 2022 and became chairman in February 2025.

Aiyesimoju also holds 86 million shares directly, and Dalio Property, which Biobaku founded, holds 45.2 million. Counted together, the group around Themis controls about 27% of the company…

It was all smooth sailing. In 2019, almost immediately as the group began consolidating their stake, Aiyesimoju became Group Managing Director. Shortly after the Nigerian economy buckled.

In 2020, the lockdown wiped out much of April and May's sales, and input costs rose as dollars became scarce. Operating profit fell to ₦3.6 billion from ₦4.8 billion. UAC responded by selling off non-core assets. It sold control of MDS Logistics to its partner Imperial Logistics, keeping a minority stake, and began separating UPDC so its property assets could be distributed to shareholders through a REIT. The group still made a net profit of ₦4.3 billion.

In 2023, the naira was devalued. UAC had lost ₦4 billion in 2022. The operating businesses were squeezed, but the holding company had protected its capital before the shock arrived by acting more like a capital allocator than an operator. It survived 2023 only because of a real estate sale and a ₦3.6 billion foreign exchange gain, since about 30% of the holding company's treasury portfolio was held in dollars. This distinction is key to the Themis Capital strategy: UACN is a vehicle for buying long-lasting African companies that will generate growing positive free cash flow well into the future. Their main job is to compound this capital; selling gala is just the means of doing this.

The recovery followed. In 2024, revenue rose about 63% to roughly ₦198 billion and profit before tax more than doubled to about ₦26 billion, the best result in a decade. Part of that was inflation; UAC now also reports in dollars, showing trailing operating profit of about $16 million by mid-2025.

The company was stable, and growing. Now it was time to begin phase two.

First, a history lesson. In 1962, Warren Buffett's partnership began buying Berkshire Hathaway, a struggling textile maker trading below its asset value. By 1965 it had control. When Buffett wound up the partnership in 1969, investors could take Berkshire shares directly. The listed shell became the vehicle for half a century of acquisitions and arguably the greatest investment firm in modern history.

The Themis story rhymes. A newly formed investment firm put most of its capital into a single listed company trading below the value of its parts. Its founder took over management. The company sold or spun off what did not fit, built up cash, and then used its balance sheet to buy something larger.

The design wasn’t entirely by choice. African private equity funds, raised for seven to ten years, struggle to exit because local buyers are scarce, IPO markets are thin, and in reality the companies that are “private equity” size in Africa are often still in growth mode, meaning it takes longer to reach a mature state where sales will be attractive. However, owning a listed company changes that: investors who want liquidity can sell on the exchange, and those who want to stay can stay indefinitely.

Fola rarely names Buffett, but you can see the oracle of Omaha's influence in his actions, and even sometimes in his vocabulary. In October 2025, UAC completed its purchase of C.H.I. Limited, the maker of Chivita juice and Hollandia milk and yoghurt, for about ₦182.4 billion, most of which was financed with debt. At the time, CHI’s revenue was 2.5x bigger than UAC’s. At the presentation explaining the deal, the title slide called it "a wonderful business at a fair price", one of the popular maxims from Charlie Munger, Buffett’s long-term partner at Berkshire. He says that it is far better to buy a wonderful company at a fair price than a fair company at a wonderful price.

Fola framed the deal in terms of scale. "We sell almost 2.5 million units, and more than a million litres of product every single day," he said. "Those products reach consumers in Sokoto, they reach consumers in Enugu, and they reach consumers everywhere." CHI, he argued, added strong positions in large, growing categories to UAC's existing distribution.

UAC’s plan for CHI was simple. Through diligent cost cutting and running an efficient operation, UAC Foods had a net margin of 15%. CHI, although much bigger revenue-wise, had a gross profit of only 6%. The goal was to bring that up to 15%. If they could achieve this, it’ll unlock ₦45bn extra profits, which adds to cashflow to pay down the debt and eventually acquire another company.

For a company that had spent five years shrinking its debt, it marked a shift: UAC was now borrowing to grow. The effect on the numbers was immediate.

If this is useful, don't gatekeep. Forward this to one person who needs it. That's how we grow 🍞

NNPC Ltd is considering selling 5% to 10% of its shares, mainly on Nigeria’s own market, with a possible second listing in London or New York, chief executive Bashir Ojulari said. It may also list some subsidiaries separately, as Abu Dhabi’s ADNOC has done. He said transparency is the main aim and raising money comes second, and NNPC expects to spend all of 2027 getting ready.

The books are the hurdle. NNPC’s 2025 profit rose 32.7% to ₦7.18 trillion, but about 99% of it came from “sundry income”. On the finance minister’s $160 billion illustration, a 5% to 10% sale would be worth $8 billion to $16 billion.

Watch: progress on fixing the governance and reporting gaps its advisers flagged. A 2028 listing is the earliest realistic date.

OPay priced its New York listing at $19 a share, raising $304 million at a valuation of about $4 billion. Then, before a single share traded, it called the deal off. The stock was indicated 12% to 15% below the offer price before the exchange halted it, and OPay and its underwriters terminated the agreement that evening.

The company blamed a regulatory inquiry in an unnamed jurisdiction it calls immaterial to its business, and says its operations are unaffected. The business itself is growing fast: first-half revenue more than doubled to $467.1 million.

Watch: which regulator is involved, and what happens to the planned listing on the Nigerian Exchange.

Nestlé Nigeria will transfer its waters and premium beverages business into a new company that becomes part of Peranel, a 50:50 joint venture between Nestlé S.A. and Platinum Equity. The venture holds more than 30 brands, including Pure Life and Perrier, and is valued at $5.6 billion.

The price for the Nigerian unit has not been disclosed. The deal needs approval from the SEC, the competition regulator (FCCPC) and shareholders, backed by valuations from KPMG and a Deloitte fairness opinion. Meanwhile profit rose 42.6% to ₦103.37 billion in the nine months to September.

Watch: the shareholder vote, and what Nestlé Nigeria says it will be paid.

🌍🇳🇬 Africa launches a $5 billion energy bank as Western lenders pull back
Africa has its own oil and gas bank. Afreximbank and the African Petroleum Producers’ Organisation (APPO) formally set up the Africa Energy Bank at its first general meeting in Abuja on 31 October. The bank has $5 billion in authorised capital and is led by its first president, Helmy Ghazi. It will finance projects across the energy chain, from exploration and production to pipelines, refining and distribution. It will also try to cut Africa’s reliance on imported fuel and boost energy trade between African countries. The founders say traditional lenders are pulling out of fossil fuels even though oil and gas remain central to the continent’s energy systems. Oil and gas investment in Africa fell from $68 billion in 2016 to about $37 billion in 2025. The bank says Africa faces a $200 billion energy financing gap. It will seek money from governments, national oil companies, financial institutions and private investors. Watch: how much capital shareholders actually put in, and which projects get the first loans.