Private equity firm AfricInvest has raised $411 million (Sh47.9 billion) in a new fund for investments in mid-sized companies in African countries including Kenya.
The newly closed fund, dubbed AfricInvest IV, is the largest the firm has raised, eclipsing the $300 million (Sh35 billion) it raised from the previous flagship fund, AfricInvest III, which closed in 2016.
It ordinarily caps investment per region in Africa at 35 percent of a fund, meaning that East African investments could access up to $144 million (Sh16.8 billion) from the AfricInvest IV fund.
AfricInvest said the new round of funding has come from new and returning institutional investors, development finance institutions, and family offices from around the world.
“Seeing how many of them have recommitted to this mid-cap fund strategy, especially amidst the Covid pandemic, is a testament to their belief in our ability to deliver attractive risk-adjusted returns,” said AfricInvest senior partner and managing director for East Africa George Odo.
The firm said that some of the investors in AfricInvest IV fund include BII UK (formerly CDC UK), German investment fund DEG, the European Investment Bank (EIB), Dutch development bank FMO, IFC, and French development institution Proparco.
African insurance firms and pension funds have also invested in the fund.
The firm has already made a Kenyan investment from the new fund, acquiring a 36 percent stake in auto parts distributor AutoXpress jointly with the International Finance Corporation (IFC) from British PE fund Actis last month.
It did not, however, disclose the amount it has invested in AutoXpress, which is an importer, distributor, and retailer of tyres, auto parts, and accessories in East Africa.
AfricInvest has also made two other investments from the fund, taking up a minority stake in Fidelity Bank Ghana in 2020 and in Moroccan irrigation and agribusiness company CMGP-CAS in 2021.
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Since its inception in 1994, AfricInvest has raised more than $2 billion (Sh233 billion) in funds, which it has deployed into over 190 companies in more than 35 African countries.
In Kenya, its investee firms have included UAP Insurance Group, Family Bank Kenya, I&M Bank Rwanda, Prime Bank, Britam Holdings Group, Silafrica Plastics & Packaging International, Abacus Pharmaceuticals and Brookhouse Schools.