Mauritius: The sky’s the limit for the Dalais family

By Olivier Caslin

Posted on Monday, 16 May 2022 14:20

From sugar to finance, the Dalaian dynasty, whose entrepreneurial activities date back more than a century in Mauritius, has even become a pioneer in private equity financing.

By its very history and structure, Mauritian capitalism resembles a life-size game of Seven Families. The three main families – in no particular order, the Lagesse, the Espitalier-Noël and the Dalais – together control several hundred companies within their respective multi-sectoral groups, representing today a large part of the island’s GDP, as well as a majority of its jobs.

This is the case for the Dalais family, which is present in Mauritius’ agribusiness, textile, real estate, finance, tourism and health sectors. It is also active in a certain number of more or less surrounding countries: Madagascar and Seychelles’ financial sectors, Bangladesh and India’s textile sectors, Kenya and Tanzania’s agribusiness sectors, and finally, Uganda and Nigeria’s private health sectors.

All these activities have been grouped together since 1978 within the Consolidated Investments and Enterprises Ltd (CIEL) group, which was set up to respond to the diversification logic that the Dalais family initiated in the 1970s and which then characterised the entire Mauritian economy.

Sugar as a compass

It is very possible that Adrien Dalais would not recognise his company today. The great-grandson of Bernard, who came from a small village in Correze and was the first Dalais recorded on Mauritian territory in 1760, started the family business in 1912 by acquiring a modest sugar refinery named Deep River, which is located on the eastern part of the island. Despite the 1929 crisis and the cyclones that hit the region in 1931 and 1945, Adrien’s small company was not impacted by the crisis and instead surfed on the wave of sugar, then the Mauritian economy’s white gold, to expand its activities.

He and his son Pierre continued to expand the estate. In 1948, they took over the reins of the neighbouring Beau Champ sugar factory and established the Deep River-Beau Champ company. The father and son then annexed other properties, thus becoming the key players in a sector that is itself indispensable to the island.

The first major change of direction was taken by Pierre’s son, who launched the family business into the textile industry, which had been booming ever since the first free trade zone was set up on Mauritian territory in 1971. Two years later, Deep River-Beau Champ became a majority shareholder in Floréal Knitwear, the very first garment factory that was established on the island and which was originally created by Hong Kong investors.

This strategy enabled the group to diversify its activities and its heir to distinguish himself from his father, who bears the same first name, as he was honoured a few years later by Queen Elizabeth II, following a recommendation from the Mauritian government. It symbolised the economic boom that the country experienced throughout the 1990s. Although Sir Pierre died prematurely in 1991, at the age of 62, he left behind a flourishing company which, along with textiles, also became active in the tourism sector and increased its commercial activities.

Time for consolidation

The time then came to separate the sugar sector from the others and create the CIEL group. The task of integrating and restructuring all the group’s levels fell to Arnaud, one of Sir Pierre’s four sons, who had been working alongside him since 1977.

15 years later, as CIEL’s first CEO, his job is to continue the work of his predecessors. As such, he made sure to surround himself with the best experts. He also knew that he could count on the support of his brothers, starting with Jean-Pierre, who quickly became his right-hand man. Arnaud consolidated the group’s existing activities in the tourism and hotel sectors while tackling new financial, health, and real estate markets.

Above all, he spent more than a decade pursuing the path that his father had embarked on, as early as 1989, to internationalise the activities of the CIEL group, for textiles in Madagascar and on the Indian subcontinent, as well as sugar in Tanzania and Kenya.

These last two operations helped CIEL sufficiently strengthen its Deep River-Beau Champ subsidiary. It also enabled it to merge with the Mauritian sugar company, FUEL, and create Alteo, which is one of the most significant operators on the island today and 21% owned by the CIEL group, in 2012.

Driven by finance

The latter has also become a significant player in finance, as it is now the majority shareholder of BNI Madagascar, one of the Big Island’s main banks, while its private equity arm, Kibo Capital Partners, invests in Zambia, Kenya and Rwanda. In 2013, at the age of 50, Arnaud Dalais was appointed Chairman of the Board of Directors, replacing Christian, his cousin.

Arnaud Dalais still holds this position, while in 2017 his brother Jean-Pierre, who is nine years younger, became the group’s CEO. Both of them sit on the board of directors, along with their cousins Dalais, Marc and Thierry. Arnaud’s son Guillaume, for his part, runs the real estate division CIEL Properties.

Created in 2020, it will ensure the development of the group’s assets, including the private estate of Ferney, which covers more than 2,800 hectares along the eastern coast of Mauritius. In 2014, the group was listed on the first market of the Mauritius Stock Exchange and decided to open up its shareholding, through a $52m fundraising campaign, to European investors, mainly French. This was an opportunity for some big names such as Peugeot Invest, Dentressangle Initiatives, Proparco and Fimalac to acquire a stake in the CIEL group and support its overall development.

Of course, the pandemic has strongly impacted tourism activities, and the group, which employs 32,000 people across its five divisions, saw its revenues fall by 27% in 2020 to 13.5bn Mauritian rupees ($311m). This is not a cause for concern for the Dalais, who at the same time have recorded very positive results in their finance and health branches. This has allowed them to rebalance their accounts and maintain a clear horizon for CIEL.

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