Featuring on the Choiseul Institute list of top 100 Economic African Leaders of tomorrow under 40, Mohammed is apparently regarded as one of Africa’s economic leaders.
Talking about this recognition, he says, “having a foundation in economics, finance and or international relations will certainly give you a solid foundation to being identified or recognised by any group.”
Mohammed adds that having the foundation or understanding of how global and African economies work is just the beginning of the journey. As per any field of work in life, be it being an economist, investment banker, engineer, doctor, music artist or a sportsman, there are basic fundamentals which need to be adhered to for one to excel or be recognised.
- Firstly, as Malcom Gladwell stated in his book, “Outliers”, you need to put at least 10,000 hours in a particular field to be considered as successful or be recognised as a “specialist” in that field. For example, I started working as an investment banker in 2017, and have been doing this consistently for almost 13 years.
- Secondly, I believe you need to be consistently good at what you do.
- Thirdly, you can’t be recognised as a leader of tomorrow if people don’t trust you.
- Lastly, you need to cultivate the habit of building long lasting and beneficial relationships and networks.
The Nigerian Economic Investment Space
Mohammed affirms that the Nigerian economic investment space is very competitive, saying that, “Nigeria is blessed with a lot of resources and opportunity, incredibly smart, talented and hardworking entrepreneurs. The competition is being able to dissect the small to medium scale businesses, identifying unique opportunities promoted by good people which will have significant mass impact on the populace and the economy.”
On strategic/capital market investments that would encourage economic growth in Nigeria, the experienced economist says, “any type of investment that will yield an economic dividend will stimulate growth in Nigeria. We can assess strategic investments by Public Sector Institutions and Strategic/Capital Market Investments by Private Sector Institutions.”
He continues: “It goes without saying that Public Sector is the main source of infrastructure and social investments in Nigeria or any other country. It is estimated that Nigeria has an Infrastructure deficit of US$100bn per annum. For Nigeria to experience double digit GDP growth (which is what is required to be a middle income country by year 2050) compared to the 1% – 2% growth currently experienced, there needs to be significant and consistent investments in infrastructure such as Power, Water Supply, Transport (Road and Rail), ICT, Shipping and Ports, whilst social investments in areas such as education and healthcare are absolutely fundamental for a country which has a population growth rate of 3% per annum.
“On the Private Sector side of things, If a company is able to raise equity capital successfully via a strategic sale of shares, an IPO, a rights issue etc. or raise debt capital through project finance, a commercial loan, a bond or a structured note and deploy this capital to grow its business organically or inorganically, there will automatically be a trickle down effect which will positively impact the economy.”
Mohammed’s role as the Associate Vice President at AFC comes with challenges and responsibilities alike. He says his role “is to originate transactions; build and maintain client relationships; ensure seamless execution process on M&A, Capital Markets and/or Project Finance transactions on behalf of my clients. My role is effectively to be the key point person and manage transactions from start to finish. It is an absolutely challenging but fun role.”
On challenges, he says this role is, “particularly challenging as I am a generalist. Meaning I cover all sectors (Transport – rail, road, airports, ports; Natural resources; Heavy Industry – Refineries, cement and Telecoms) simultaneously across multiple jurisdictions in Africa, and I always need to be up to date on activities on all these sectors. Also, transactions I work on usually take time and involve multiple entities. From Technical advisors, to Legal advisors, to Commercial advisors, to Government or Public Sector entities, to partner Investors and financiers, the list goes on.”
There are always challenges but, navigating through them is what indicates leadership. It is for this that Mohammed, “empowers (his) team to the maximum. I let them take responsibility and lead certain aspects of transactions whilst I provide oversight. I also ensure I communicate regularly with all parties be it clients or direct reports. I don’t claim to know everything, so when I don’t know how to deal with certain situations, I go and seek counsel from those who do.”
He states that “M&As in general is challenging for several reasons.” Then adds that one of the “most challenging is a transaction I worked on for Dangote Group a few years back whilst I was at Renaissance Capital. We had a strategic mandate to raise c.US$700 MM for Dangote Industries Limited through a sale of its shares in Dangote Cement. I was an associate at the time and was responsible for producing all the transaction documents (financial models, Information memorandum, management presentations etc.). We ran the transaction in tranches and had successfully closed tranche 1 where we sold a stake in Dangote Cement for c.US$300 MM. On tranche 2, we had significant interest from a very large US based investor. The transaction was going to be their first in Nigeria, so the diligence process was extremely thorough, and we had 3 months to conclude the transaction. We undertook due diligence visits to Dangote Cement Plants across Africa (10 countries), Granular valuation models were built per Cement Plant and on a consolidated basis, market studies, technical studies were evaluated. At the end, time was running out and the transaction fell off during negotiations between the Investor and Dangote Group. Challenging process and more so challenging as it was unsuccessful but no knowledge was lost and it was a great experience all in all.”
He assesses the investment space in Nigeria and investment opportunities for Nigerians in the medium to long term saying, “Nigerians need to start preparing for a post-oil era in a country with high population growth.
“I believe investment opportunities should be targeted at service-based businesses backed by high technology solutions be it in agriculture, transport and logistics, Fintech, Telecoms etc. I also believe investment in education is absolutely fundamental in the medium to long term.”
Debunking investment myths that Nigerians buy into, Mohammed says, “I think Real Estate – particularly real estate in Lagos is overplayed. Purchasing power is limited, capital appreciation is usually eroded through foreign currency devaluation, ability to increase rent above inflation rates year on year is non-existent. So, it is a myth for me.”
On FDIs and government’s role in it, the investment expert says, “Nigeria is absolutely positioned for FDI. We just need to provide the right regulatory environment to harness those resources and also streamline the regulatory bodies to reduce overlap in regulatory oversight which is a major burden for doing business in Nigeria today.
How he unwinds…”spending time with family and friends, watching sports, working out, travelling and mentoring.”
Mohammed Usman Abdul-Razaq is an Associate Vice President in the Financial Advisory team at the Africa Finance Corporation. Mohammed has over 12 years experience in project finance & corporate finance advisory, capital restructuring, mergers & acquisitions and financings in Emerging Markets / Sub-Saharan Africa with core focus and expertise in the Aviation, Oil & Gas, Metals & Mining, Heavy Industry, Transport, Consumer & Financial Institutions sectors. Prior to joining Africa Finance Corporation, Mohammed began his career at Morgan Stanley where he spent 5 years working in the M&A team covering clients in Emerging Markets / Sub-Saharan Africa across the aforementioned sectors.