XSML, the Amsterdam-headquartered private equity fund manager, has held the first close for its African River Fund at $45 million, attracting commitments from a number of development finance institutions including all three investors in the fund manager’s $19 million maiden fund, the Central Africa SME fund. African Rivers Fund, which has a hard cap of $65 million, will target debt, equity and mezzanine finance to rapidly growing SMEs in Central Africa in deals ranging from $100,000 to $5 million in size.
While their commitment levels were not disclosed, among the new investors for this closing were the Belgium Investment Company for Developing Countries, the Dutch Good Growth Fund and FISEA, the investment fund held by Agence Française Développment. The International Finance Corporation, the Lundin Foundation and Dutch development bank FMO are repeat backers of XSML, being current investors in the fund manager’s first fund.
Commenting on the closing, XSML’s Managing Partner Marcel Posthuma pointed out that “The private sector in Congo has tremendous growth potential and long term capital is scarce. XSML is well placed to capture the opportunities as the first and only fund manager on the ground in DRC actively making investments in private companies in Congo, creating jobs and supporting the growth of the economy.”
To date, XSML’s first fund which is now fully-invested and has two exits under its belt, has made 32 investments across 10 sectors. Some 80% of the fund’s investments have benefited SMEs in the Democratic Republic of Congo with the balance located in the Central African Republic. African Rivers Fund will continue to target opportunities in these two countries as well as in Burundi, Republic of Congo and Uganda.
XSML has a team of 12 investment and operating professionals based in offices in Kinshasa and Bangui. The private equity fund manager has plans to open an office in Uganda’s capital, Kampala, in the near future.