By John Ikani
BlackRock, a global investment giant, is pulling the plug on its Africa-focused iShares exchange-traded fund (ETF) due to challenging business conditions in Nigeria and Kenya.
The iShares fund, valued at $400 million, will undergo a liquidation process.
“Unprofitable business environments” in these key African markets were cited by iShares Inc. as the reason for the closure.
The statement also acknowledged the impact of currency fluctuations, particularly the devaluation of the Nigerian Naira on the liquidation timeline.
The fund’s last trading day is targeted for March 31, 2025, marking the end of an extended liquidation period that begins in August 2024.
During this timeframe, iShares will gradually sell its holdings in all markets and convert them to cash equivalents.
This decision reflects a broader trend of foreign investors exiting Nigeria’s market due to a tough economic climate.
The statement highlights the role of currency fluctuations in the iShares liquidation process.
BlackRock’s move follows the complete withdrawal of iShares investments from the Nairobi Securities Exchange (NSE) in Kenya.
The Kenyan portfolio, valued at $5.2 million, included holdings in major companies like Safaricom, Equity Group, and KCB Group.
Previously, the iShares fund provided exposure to a range of African stock exchanges, including those in Egypt, Morocco, and select Asian and Eastern European markets.
