The African Development Bank (AfDB) has
approved a $20 million equity investment in Uhuru Growth Fund 1, a
first-generation fund sponsored by Uhuru Partners Limited, a private
equity firm, focused on high growth middle market businesses across West
Africa.
Uhuru Partners Limited is composed of an
experienced indigenous team with strong local networks,
extensive
knowledge of the West Africa market and a track-record of SME
investments in the region.
The Bank’s equity support would enable
Uhuru Partners make investment forays into consumer facing and financial
services sectors in West African countries including Nigeria, Ghana,
Cote d’Ivoire, Senegal, Burkina Faso and Mali.
Investments of $5 million and above
would be made in companies in these sectors, helping them grow into
regional champions, and creating new, high quality jobs.
The proposed investment would give the Bank approximately 10 per cent of the Fund’s target capitalisation of $200 million.
Equity capital is scarce in Africa but
particularly so for smaller companies with revenues below $50 million.
Private equity funds such as Uhuru will help address this void .
Uhuru’s compelling investment
proposition is underpinned by several macroeconomic and institutional
factors. These key factors include West Africa’s large aggregate
population, rapid urbanisation and youthful demographics, sustained
economic growth and relative political stability.
The presence of Uhuru’s key executive
and operational teams in Abidjan and Lagos was also perceived as a huge
asset, enabling the team to effectively source investment opportunities
in the Anglophone and Francophone economies of West Africa. The PE
firm’s presence in the region’s largest and leading commercial hubs also
enables them to get actively involved in the operations of their
portfolio companies across the region.
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