20 January 2020

CDC Group to invest £2 billion in African businesses over the next two years

  • UK’s publicly owned impact investor unveils $400m of new agreements at the UK-Africa Investment Summit to support entrepreneurs and SMEs
  • CDC’s Chief Executive tells UK investors to “embrace the huge opportunity” to support the UN’s Sustainable Development Goals

CDC Group, the UK’s publicly owned impact investor, is to commit a further £2bn into African businesses over the next two years, as it looks to double the size of its portfolio on the continent.

The company, the world’s largest bilateral development investor in Africa, today unveiled at the UK-Africa Investment Summit (AIS) in London a string of new partnerships totalling nearly $400m. The bulk of funds will be to provide African banks with greater liquidity to support SMEs, entrepreneurs and microbusinesses in their regions.

These include:

  • A $100m trade finance loan with ABSA, the South African bank, to support SMEs in southern Africa
  • An MoU to commit $100m to CIB of Egypt to allow the bank to further support SMEs and microfinance enterprises
  • A $75m trade finance agreement with TDB to support bank lending to SMEs in 32 African countries
  • A $10m debt agreement with Mettle Solar Africa to accelerate the roll-out of solar energy in South Africa and Namibia
  • $27.5m investment in Mediterrania III Fund to support mid-cap businesses in North and West Africa
  • $20m investment in Adiwale I Fund to support SMEs in West Africa with growth capital
  • A $20m investment in Verod Cap Growth III Fund to support SMEs active in high growth sectors in West Africa
  • A $20m investment in Metier Sustainable Capital II Fund, a renewables fund focusing on sub-Saharan Africa
  • A $15m investment in the TLcom TIDE Africa Fund, a sub-Saharan African VC fund that supports businesses that leverage technology and innovation

Nick O’Donohoe, Chief Executive of CDC, said:

“Investors have a real opportunity to embrace the UN’s Sustainable Development Goals – in partnership with African countries and businesses – to fight climate change, create jobs and skills and bring about positive social and environmental change.

“The commitments we have announced today will accelerate the roll-out of solar power and other renewable technologies and support the growth of countless SMEs – the bedrock of any healthy economy – across the continent.”

CDC is responsible for over 10 per cent of all capital invested through Africa-focused private equity funds.

Despite Africa being home to eight of the world’s 15 fastest growing economies, the continent receives less than 4 per cent of global foreign direct investment.

Strive Masiyiwa, the founder of pan-African telecoms, media and technology company Econet and one of Africa’s best-known entrepreneurs and philanthropists, said:

“The role of development finance institutions like CDC is vital in providing much needed long-term patient capital for African entrepreneurs and businesses. There is a significant opportunity for UK investors to work with African businesses to create a brighter, sustainable and more prosperous future for the continent.”

Mr O’Donohoe added: “The UK is already the investment partner of choice for many African nations. The investment community here now has a fantastic opportunity to strengthen that position by aiming to make a positive impact to bring about sustainable, long-term economic and social development. That aim does not diminish the financial opportunities that exist for all types of investors. In fact, it enhances them”.

CDC already has investments in  over 700 African companies. In 2018, its investee companies collectively employed about 370,000 people and supported millions more through supply chains.

Among its recent deals in Africa was a $180m equity investment in Liquid Telecom to accelerate the rollout of its pan-African high-speed fibre optic network, including into underserved markets such as Sudan and the Democratic Republic of the Congo, and a $92m capital injection to the Nubian Suns project in Egypt, part of the largest solar power installation in the world.

ENDS

 

About CDC Group

CDC Group is the world’s first impact investor with over 70 years of experience of successfully supporting the sustainable, long-term growth of businesses in Africa and South Asia.

CDC is a key advocate for the adoption of renewable energy in Africa and South Africa in the fight against climate change and a UK champion of the UN’s Sustainable Development Goals – the global blueprint to achieve a better and more sustainable future for us all.

The company has investments in over 1,200 businesses in emerging economies and a total portfolio value of £5.8bn. This year CDC will invest over $1.5bn in companies in Africa and Asia with a focus on fighting climate change, empowering women and creating new jobs and opportunities for millions of people.

CDC is funded by the UK government and all proceeds from its investments are reinvested to improve the lives of millions of people in Africa and South Asia.

CDC’s expertise makes it the perfect partner for private investors looking to devote capital to making a measurable environmental and social impact in countries most in need of investment.

CDC provides flexible capital in all its forms, including equity, debt, mezzanine and guarantees, to meet businesses’ needs.  It can invest across all sectors, but prioritises those that help further development, such as infrastructure, financial institutions, manufacturing, and constructions. Find out more at www.cdcgroup.com

 

For further information please contact

Andrew Murray-Watson

123 Victoria Street, London, SW1E 6DE

  1. +44 (0) 20 7042 1569
    M. +44 (0) 7515 695232
  2. amurray-watson@cdcgroup.com