ATLANTICA VENTURE CAPITAL FUND BOOST AFRICA JUNI

Promoteur – Intermédiaire Financier

SPECIAL PURPOSE ENTITY(IES)/FUND

Lieu

• Régional - Afrique

Description

The proposed operation consists of an equity participation of up to EUR 10 million in junior tranche in Atlantica Venture Capital Fund, a USD 50 million target venture capital fund focusing on small and medium-sized enterprises (SMEs) with a high growth potential (start-ups) and active in the digital and technology sectors in sub-Saharan Africa

Additionality and Impact

The operation will contribute to the EU objectives in the Sub-Saharan African region. In particular, the Fund's strategy will promote inclusive and sustainable growth led by the private sector, which is in line with EU's agenda for Change and the Cotonu Agreement, as well as the EU Consensus for Development. The operation is in line with national priorities of various African governments, which prioritize support to private sector development and women's economic empowerment as a means of fostering inclusive and sustainable economic growth and economic resilience. This operation will contribute to Sustainable Development Agenda in a number of interlinked ways.

The proposed project will contribute to deepening and expanding the reach of financing available to innovative, high growth SMEs in sub-Saharan Africa. It is expected that the Fund will invest in start-ups and expansion businesses that will ultimately lead to provisions of improved products and services to the targeted population. The management of the Fund still has to demonstrate its capacity to source and develop projects, as well as to assist in the implementation and operational stage. The Bank's involvement, together with other interested DFIs and private investors, will act as a catalyst to attract interest from the private sector. It also ensures that the investments of the Fund create high socio-economic benefits rather than exclusive focusing on profit maximisation.

EIB's objectives is to mobilise third party capital investments in the SSA private equity industry. Since the COVID-19, the fund raising activities have significantly slowed down. Prospective investors have delayed their commitment timeline, or postpone to future closes as due diligence has been delayed because of COVID-19 travel restrictions. Under this context, the approval of the EIB junior tranche investment is deemed instrumental to mobilize additional investors and help the Fund to reach its minimum fund size. The Bank has worked closely with the Fund Manager in order to structure the Fund in accordance with the Bank's usual requirements and international best practices.

Objectifs

The proposed operation consists of a junior tranche investment in Atlantica Venture Capital Fund, a new closed-end venture capital fund targeting start-ups in the digital and technology sectors in six sub-Saharan African countries including, among others, Nigeria, Kenya, Tanzania and Côte d'Ivoire. The fund's strategy is to generate returns through an active hands-on approach in the FinTech, logistics, agribusiness, Internet of Things (IoT), e-commerce and cybersecurity sectors. The team will seek to create value through an active management approach leveraging their data scientist team to drive the growth and profitability of portfolio companies while building capacity in terms of management, corporate governance as well as environmental and social standards

Secteur(s)

• Services - Activités financières et d'assurance

Montant BEI envisagé (montant approximatif)

EUR 10 million

Coût total (montant approximatif)

EUR 41 million

Aspects environnementaux

The fund's operational guidelines provide for environmental and social due diligence of investee companies according to guidelines acceptable to the Bank.

Passation des marchés

Not applicable.

Statut

Signé - 20/12/2021