Central and East Africa-focused fund manager XSML, via its African Rivers Fund, has made an unspecified amount of follow-on investment in SOS Médecins de Nuit (MDN), a Kinshasa-based healthcare clinic.
XMSL which recently has established physical presence in Kampala, Uganda, invests in Central African frontier markets with offices in the Democratic Republic of Congo, and the Central African Republic capital of Bangui.
Its backings include a call centre, pharmaceutical manufacturer, school, all in the DRC, as well a transport company and coffee roaster, in the Central African Republic. It has made 12 investments so far.
MDN was among the first DRC firms which XSML funded in 2011. The healthcare facility has recorded significant growth in the past years – they have established a clinic, expanded to two more locations and stretched offering from emergency healthcare to a holistic variety of services and procedures.
Asides now offering maternity, a theatre, an intensive care unit and an ultra-modern lab with imaging equipment, MDN’s team has spread its tentacles to provide global-standard healthcare services to privates and corporate clients, embassies and Non-Governmental Organizations (NGOs).
As reported by Africa Global Funds, Barthout van Slingelandt, Managing Partner at XSML says: “It has been an exciting journey with the team of MDN over the last seven years to bring the clinic to where it is today, combining both financial and technical support from our end with the daily care and medical expertise of the MDN team.”
“The new financing will help consolidate the current platform and help in further growing and improving the quality of healthcare to a larger part of the population, in Kinshasa and beyond. We look forward to continuing supporting MDN in the years to come and get the clinic to the next level,” he said.
Serge Holenn, Medical Director of MDN, said: “Together with XSML we have been able to grow our footprint significantly in the last seven years and have grown from a niche emergency healthcare clinic to a provider of healthcare to a wide range of clients across a spectrum of services, delivered by an outstanding team of specialists and nurses.
The new financing from ARF helps us in executing our strategic plan by further expanding our footprint, with several new satellite clinics, new imaging equipment and more working capital to manage our growth.”
It is uncommon to hear that countries such as DRC and CAR are hard to invest in, but the reality is they are considered to be. The harsh business environments are an influential factor in this funding deficit.
Respectively ranking 184 and 185 in the World Bank’s ease of doing business index, the two countries are some of the last finishers in a race run by 190 countries.
Nevertheless, XMSL’s Heijstee said that one of the upsides to operate in such a region is the vivid lack of competition for the deals, which means that the investors can buy shareholding at more favourable valuations.
He said that assets could be sold to other funds looking for exposure in the region. “They don’t have a presence; they don’t know the market that well, but they do want to get some exposure. From an exit point of view, I don’t think not having a stock market makes a big difference.”
The new African Rivers Fund (ARF), which gets its name from the Congo and Nile rivers, focuses “growing, well-managed” small and medium enterprises with investments of between USD 250 K and USD 5 Mn.
The initiative, which exists under the favours of institutions such as the Belgian Investment Company for Developing Countries (BIO); the CDC, the UK’s development finance institution; the Dutch Good Growth Fund; and the International Finance Corporation.
July last year, the fund made its seventh investment in Uganda’s TMR International Hospital, a general hospital that majors on maternity healthcare, emergency relief and ear, nose and throat (ENT) services.
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