Metier Capital Growth Fund III

Equity : June 2023

BIO has committed USD 6 M equity to the Metier Capital Growth Fund III, a PE Fund focused on Sub-Saharan Africa.

Amount

$ 6,000,000.00

Type of investment

Equity

Development impacts

Local economic growth
Private sector consolidation/innovation
Promotion of ESG best practices
Gender

Beneficiary locations

Africa: Ghana, Kenya, Nigeria, South Africa, Uganda

Investment field

Investment Companies & Funds

Activity

KK.64.300 SME Fund

Organisation

Metier Capital Growth Fund III

Website

https://www.metier.co.za/

Domicile

Mauritius

Metier Capital Growth Fund III is a generalist private equity fund seeking to invest growth capital in solid companies with attractive expansion opportunities in specific countries of Sub-Saharan Africa and supporting them through its collaborative partner style.

Our investments will develop new business opportunities which will have a positive impact on climate change, create decent jobs with a broader focus on gender-lens investing, support the connectivity of rural communities, and enhance small to medium size business development across Africa.

Paul Botha, CEO and Co-Founder of Metier.

The fund, which will be managed by Metier Private Equity International, will invest in eight to twelve mid-market companies primarily in Southern and East Africa. The fund will invest in sectors including telecommunications, fast moving consumer goods, healthcare, non-banking financial services, manufacturing as well as infrastructure and energy. MCGF III will invest at least 40 percent of the fund outside of South Africa.

Development impacts

Local economic growth
Increased access to growth capital to 8-12 companies in various sectors with solid foundations and high growth features and the potential to participate in regional expansion opportunities, thereby contributing to the emergence of regional sector leaders, to employment creation, tax revenue generation, infrastructure and trade development.

Substantial employment effects are expected - up to 8,000-9,000 new jobs (in line with its predecessor fund with same investment mandate and size), while the fund is proactively supporting training opportunities and skill development as well as jobs quality within the portfolio companies.
Private sector consolidation/innovation
Active added value mindset and working alongside investees entrepreneurs and management teams to help them expand and succeed with innovative commercial and strategic approaches.

Strategy towards emphasizing the use of growth capital in support of entrepreneurial teams and into platform build-ups to create regional businesses and foster regional expansion.
Promotion of ESG best practices
Intentional focus on ESG and Impact thanks to an in-house ESG team supported by specialized consultant firm IBIS to assess, manage and mitigate ESG risks, as well as make systematic ESAP and identification of possible ESG opportunities that can also add value to the performance of the Fund's investees.
Gender
2X eligible fund with 50% of women employees with a commitment to use reasonable commercial endeavours to invest in at least 30% of 2X eligible business.

E&S Impact

The fund will upgrade their current E&S process, ESMS and supporting tools as well as a reinforce their E&S capacity through targeted training for better E&S risk and challenge management within their intended pipeline. Further improvements on their internal Human Resources practices and ESG & climate reporting are also included.

Situation at the time of investment

MCGF III leverages their experience managing E&S risks from previous funds and collaboration with other DFIs, and has implemented a robust ESMS and E&S processes, which will be upgraded for increased effectiveness.

Their pipeline will present new challenges due to a geographical expansion and a project on the steel sector. Their E&S capacity will be reinforced through training and a close relationship with external consultants.

Risk Category: B+