The IFC’s Board is mulling a commitment of up to $7.5 million to Fanisi Capital’s second fund which will target private equity opportunities in SMEs in East Africa. The fund, which is targeting $75 million with a hard cap of $100 million, is hoping to hold a first close during the final quarter of this year.
The 10-year closed end fund will focus its investment activities on four east African countries – Kenya, Rwanda, Tanzania and Uganda – sourcing deals from growth-oriented SMEs across a number of sectors.These will include Agribusiness, Consumer, Education, Energy, Healthcare and Retail.
In addition to the capital commitment, the IFC will provide Fanisi with associated advisory services. These include being involved in the identification and hire of experts to undertake pre-investment due diligence, other management experts to help the fund’s portfolio management companies grow their topline revenues, institute environmental and sustainability best practices and ensure governance standards are met. For optimal portfolio management, the IFC will also install an ERP system at Fanisi to improve the financial and operational performance of the fund and its companies.
Fanisi Capital, which was established in 2009, is 75% owned by its investment team with Norfund holding the remaining 25%. Fanisi’s Venture Capital Fund, the firm’s first vehicle, has been one of the more active investors in the continent in the last two years. It targets investments ranging from $50,000 to $15 million in syndicated deals in early and growth-stage businesses.
IFC’s board is expected to meet and approve the commitment on November 3rd, 2016.