Mezzanine fund manager Vantage Capital has disbursed $8.5 million to Vumatel, the South Africa fibre-to-the-home service provider, in the second and final tranche of a $17 million expansion capital facility it is providing the company. The deal is the latest transaction for Vantage’s third mezzanine fund which is targeting a final close of $270 million, 40% of which is being allocated to South African opportunities.
Agreed in April this year, the mezzanine facility was structured in two equal tranches of R125 million or $8.5 million, available for draw down upon the achievement of certain operational and financial goals by the company. Vumatel began deploying its network in October 2014 and is expanded rapidly since then to cover 22 suburbs serving some 33,000 homes in Johannesburg and Cape Town. The capital is being used to fund the company’s ongoing growth plans.
Commenting on the deal Yaw Keteku, an Associate Partner at Vantage Capital said “Vumatel is laying the foundation for South Africans to participate in a world that is increasingly data-driven, and we are delighted to be partnering with an excellent management team as they make this goal a reality.”
The deal is Vantage’s 22nd mezzanine investment and the 4th investment in Fund III. Vantage Mezzanine Fund III supported the Servest buyout last year, and recently concluded a $20 million investment in Landmark as well as an N$80 million (R80 million) investment in Namibian hospitality and property group UAG earlier this year. (
Werksmans Attorneys and Cliffe Dekker Hofmeyr acted as legal counsel to Vantage and Vumatel, respectively.