Helping Catalyst Principal Partners’ second fund close in on its $175 million target, SIFEM, the Swiss Government’s development finance institution is investing $8 million in the generalist, East Africa-focused private equity fund.
The fund held a $103 million first close at the beginning of April, landing commitments from several development finance institutions, fund-of-funds and family offices. With an IRR target of 25%, Catalyst Fund II is structured as a 10-year closed end fund, with a 5-year investment period. It will pursue a similar strategy to that executed by Catalyst Fund I, making mid-market growth capital investments within fast growth consumer demand driven sectors across Eastern Africa, with a consistent core focus on the consumer staples, financial services, industrials and healthcare industries.
Typical deal sizes are expected to range in the $7.5 million to $25 million range, taking significant minority or control positions in each of the companies it backs. It’s expected that the fund will make investments at the rate of between two and three deals per year, ending up with a portfolio of between eight and twelve companies in its portfolio once its capital has been fully deployed.