Proparco—a subsidiary of Agence Française de Développement (AFD) focused on private sector development—has picked up a stake in AfricInvest’s pan-African fund dedicated to Small and Medium Enterprises (SMEs).
The USD 30 Mn investment will go into AfricInvest’s first close of its multi-sector private equity fund, with which Proparco will support the development of strong local and regional consumer-driven businesses.
By strategically investing money into Africa’s private sector, the continent’s economic growth can become a reality. With SMEs making up a substantial part of the economy, funds such as these are a good way to bolster the ranks of these growing enterprises and help them become regional champions.
AfricInvest is a 26-year-old private equity and venture capital firm, one of the leaders in North and Sub-Saharan Africa. Since its 1994 inception, it has raised USD 1.7 Bn and haas 19 funds across 4 strategies.
The first close of the AfricInvest Fund III was concluded at an excess of USD 194.83 Mn. The Netherlands Development Finance Company, CDC Group, the International Finance Corporation (IFC), Swedfund, SIFEM and Finnfund participated in the security of the capital commitment.
AfricInvest Fund IV aims to provide growth capital to mid and large cap businesses in Africa. Its main areas of focus are consumer-oriented sectors, including financial services, manufacturing, retail and consumer goods, agribusiness, healthcare, education, telecoms, logistics and distribution.
Proparco has been partnering with AfricInvest since 1997, and has invested in 15 of the manager’s 19 funds since. Ordinarily, it partners projects in key development sectors—infrastructure (with a specific focus on renewable energies), agribusiness, financial institutions, healthcare and education, etc—and to boost the contribution of the private sector to achieving the sustainable development goals adopted by the international community in 2015.
The Proparco-AfricInvest collaboration is expected to contribute to the achievement of some United Nations’ SDGs, including point 8 which focuses on decent work and economic growth. The project also leans on SDG 9, one that advocates for investments into industry, innovation and infrastructure.
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