African Rivers Fund III
The SDG Frontier Fund has invested EUR 1.5 M in equity in the African Rivers Fund III, an SME fund which invests in small and medium-sized enterprises in Central and Eastern Africa.
Amount
€ 1,500,000.00
Type of investment
Equity
Development impacts
- Local economic growth
- Private sector consolidation/innovation
- Promotion of ESG best practices
Beneficiary locations
Investment field
Investment Companies & Funds
Activity
SME Fund
Organisation
African Rivers Fund III
Website
https://xsmlcapital.com/Other investments by
SDG Frontier Fund
- Ascent Rift Valley Fund II (Equity) € 2,000,000.00 (2020)
- Excelsior Capital Vietnam Private Equity Fund (Equity) € 2,000,000.00 (2020)
- South Asia Growth Fund II (Equity) € 2,000,000.00 (2020)
ARF III is XSML’s third fund under management, after its maiden fund the Central Africa SME Fund (CASF) and its second fund, African Rivers Fund (ARF), bringing total assets under management to USD 120 million.
ARF III targets growing, well-managed small and medium-sized enterprises (SMEs) in the Central African region covering Angola, the Democratic Republic of Congo (DRC), Uganda and the Republic of Congo and surrounding countries. The fund is named after the two most powerful rivers in Africa, the Congo and Nile Rivers, which embody the potential of the Central and East African region. ARF III follows the successful investment strategy of its predecessor funds, CASF and ARF, by providing debt, equity and mezzanine finance to fast-growing companies in these regions.
The private sector in DR Congo and Uganda, our core markets, as well as Angola, our new third home market, has tremendous growth potential and long-term capital remains scarce.
Jarl Heijstee, Managing Partner at XSML
For this first close, BIO (Belgium Investment Company for Developing Countries), the Dutch Good Growth Fund (DGGF, managed by Triple Jump), FMO (the Dutch development bank), IFC (a member of the World Bank Group), which are all existing investors in Fund I and/or II, are joined by Swedfund (Swedish development bank) and the SDG Frontier Fund (which includes nine private and institutional investors from Belgium) - an expansion of the investor base of ARF, which demonstrates their commitment and support for investing in these frontier markets.
Development impacts
-
Local economic growth
The fund provides long-term finance to SMEs as a combination of debt and equity, with an expected ticket size between $ 250,000 and $ 7.5m and a tenor around 5 years. The fund operates in markets where banks' lending to SMEs is very limited and where only very few private equity funds are active. The fund can help proving the viability of financing SMEs and can help them attract additional finance once they have grown in size and have a proven track record.
-
Private sector consolidation/innovation
ARF III is one of very few funds active in the target region and the only PE fund with an office in DRC. The fund offers mezzanine finance to SMEs which are largely underserved by local banks and therefore provide flexible, long-term finance that is crucially needed.
XSML is currently one of very few PE funds in Central Africa, and the only one with a presence in DRC, with limited or no competition in most markets. The team has gained experience through 2 predecessor funds and will expand the local presence after the closing of ARF III.
The fund manager will help institutionalizing the portfolio companies in terms of reporting, information systems, financial management and governance. The team has experience in advising SME and will act as a partner in order to improve management and governance at the level of the investee companies. In the previous funds, the manager has helped to build strategic alliances, advised on strategy and business development and has organized trainings at investee companies.
-
Promotion of ESG best practices
The fund manager has a good E&S management system in place, provides ESG training to all its investment managers and works with several E&S consultants to assess the portfolio companies and to develop E&S action plans.
Read impact and news about this project
News
Repousser les frontières des investissements durables
15-12-2020
An interview with Luuk Zonneveld, An-Heleen De Greef & Eric Van
Den Bossche on the SDG Frontier Fund, published in Eventail on the 10th of December, written by Cédric Boitte. This article was published in French.
News
You'll never make the world sustainable with only public money
02-07-2020
Financial return is worth twice as much if it also helps the world move forward. The Belgian government and business world collect 50 million euros for sustainable investments in the African and Asian private sector. "Investing is better than giving," says driving force Alexander De Croo, Minister of Development Cooperation. "You will only see a return on your investment if it has really made a difference."
News
SDG Frontier Fund first closing
02-07-2020
First-of-its-kind Belgian impact fund brings together 9 private investors to support sustainable economic growth in African and Asian frontier markets.
View more of our investments in this region
Financial Institutions
The Currency Exchange Fund n.v.
7,091,000.00
Bangladesh, Cambodia, India, Indonesia, Myanmar, Nepal, Pakistan, Philippines, Sri Lanka, Vietnam, Bolivia, Brazil, Colombia, Dominican Republic, Ecuador, El Salvador, Guatemala, Honduras, Nicaragua, Paraguay, Peru, Algeria, Egypt, Iraq, Jordan, Lebanon, Morocco, Syria, Tunisia, Palestinian Territories, Benin, Burkina Faso, Burundi, Cameroon, Côte d'Ivoire, Democratic Republic of Congo, Ethiopia, Ghana, Guinea, Kenya, Madagascar, Malawi, Mali, Mozambique, Niger, Nigeria, Rwanda, Senegal, South Africa, Tanzania, Uganda, Zambia
05/09/2007
Equity
Financial Institutions
Bank of Africa Group S.A.
1,954,160.00
Benin, Burkina Faso, Côte d'Ivoire, Democratic Republic of Congo, Ghana, Kenya, Madagascar, Mali, Niger, Rwanda, Senegal, Tanzania, Uganda
30/03/2011
Equity
Investment Companies & Funds
Agri-Vie Fund II
350,000.00
Kenya, South Africa, Tanzania, Uganda, Zambia
23/11/2020
Subsidy
Investment Companies & Funds
Phatisa Food Fund 2
5,767,300.00
Ghana, Kenya, Malawi, South Africa, Tanzania, Uganda, Zambia
29/01/2021
Equity
Investment Companies & Funds
Grofin East Africa Fund LLC.
2,211,000.00
Kenya, Rwanda, Tanzania, Uganda
25/01/2006
Equity
Investment Companies & Funds
Zoscales Fund I
350,000.00
Ethiopia, Kenya, Rwanda, Tanzania, Uganda
23/11/2020
Subsidy
Investment Companies & Funds
Ascent Rift Valley Fund II
2,000,000.00
Ethiopia, Kenya, Rwanda, Tanzania, Uganda
17/12/2020
Equity
Investment Companies & Funds
Ascent Rift Valley Fund II
5,743,220.00
Ethiopia, Kenya, Rwanda, Tanzania, Uganda
23/12/2020
Equity
Investment Companies & Funds
African Rivers Fund III
6,113,520.00
Democratic Republic of Congo, Uganda
01/09/2020
Equity
Investment Companies & Funds
Fairtrade Access Fund
350,000.00
Bolivia, Brazil, Colombia, Ecuador, Guatemala, Honduras, Nicaragua, Paraguay, Peru, Burkina Faso, Côte d'Ivoire, Ghana, Kenya, Tanzania, Uganda
07/04/2020
Subsidy
Enterprises
Centre médical de la Communauté
2,719,298.00
Democratic Republic of Congo
09/05/2016
Debt
Financial Institutions
Bank of Africa RDC
1,466,000.00
Democratic Republic of Congo
29/01/2010
Equity
Investment Companies & Funds
Zoscales Fund I
21,757.30
Ethiopia, Kenya, Rwanda, Tanzania, Uganda
12/11/2019
Subsidy
Investment Companies & Funds
Frontier Energy II
8,151,000.00
Kenya, Rwanda, Tanzania, Uganda
21/03/2018
Equity
Investment Companies & Funds
AfricInvest Financial Inclusion Vehicle
10,000,000.00
Morocco, Côte d'Ivoire, Democratic Republic of Congo, Ghana, Kenya, Nigeria, Rwanda, Tanzania, Zambia
14/12/2017
Equity
Investment Companies & Funds
Fairtrade Access Fund
3,000,000.00
Bolivia, Brazil, Colombia, Ecuador, Guatemala, Honduras, Nicaragua, Paraguay, Peru, Burkina Faso, Côte d'Ivoire, Ghana, Kenya, Tanzania, Uganda
24/10/2019
Equity
Investment Companies & Funds
African Rivers Fund
4,118,275.00
Democratic Republic of Congo, Uganda
02/02/2016
Equity
Enterprises
Plantations et Huileries du Congo
9,741,280.77
Democratic Republic of Congo
21/12/2015
Debt
Investment Companies & Funds
FPM - Fonds pour l'inclusion financière en DRC
5,800,888.00
Democratic Republic of Congo
26/06/2014
Equity
Investment Companies & Funds
Africa Renewable Energy Fund
8,896,000.00
Ghana, Kenya, Senegal, Uganda, Zambia
30/10/2014
Equity
Investment Companies & Funds
Beyond the Grid Solar Fund
4,175,007.50
Burkina Faso, Côte d'Ivoire, Ghana, Kenya, Nigeria, Rwanda, Tanzania, Uganda
26/10/2017
Debt
Investment Companies & Funds
Agri-Vie Fund II
6,552,700.00
Kenya, South Africa, Tanzania, Uganda, Zambia
20/01/2017
Equity
Investment Companies & Funds
Ethos Mezzanine Partners 3
8,868,980.00
Burundi, Ethiopia, Kenya, Malawi, Mozambique, Rwanda, South Africa, Tanzania, Uganda, Zambia
13/06/2019
Equity
Investment Companies & Funds
Zoscales Fund I
4,169,100.00
Ethiopia, Kenya, Rwanda, Tanzania, Uganda
18/04/2019
Equity
