Africap Raises Capital to $50 million (Sh3.25 million).
Nairobi, Kenya, October, 27 2007 -
AfriCap Microfinance Fund, Africa's first microfinance private equity fund, on Friday announced the closing of second round of investments raising its capital from $14 million (Sh910 million) to $50 million (Sh3.25 million).
The firm said it had transformed into a permanent capital investment company and changed its name to AfriCap Microfinance Investment Company.
It said recapitalisation had received strong investor support especially from its initial shareholders including Calmeadow, AfriCap Sweden, Accion, the European Investment Bank and FMO.
Existing shareholders subscribed up to 35 per cent of the new capital.
In a statement, AfriCap said the high level of interest in the share issue was testimony to its success and a confirmation of the credibility of Africa as a private equity investment destination.
" We have been pleasantly surprised by the response that our recapitalisation has received from the investor community. The high level of investor interest is in itself, a significant accomplishment for an African microfinance fund," said chair of the firm, Anne Marie Chidzero.
Some early shareholders of the fund including Société Belge Pour Le Développement International, DOEN Foundation, Cordaid and Argidius Foundation, exited through sale of their stake to existing shareholders. The exit generated for the shareholders returns in excess of 14 per cent.
Over the past six years, AfriCap has invested in 12 microfinance institutions across Africa, generated two exits with an average return in excess of 30 per cent and participated in the listing of Equity Bank in Kenya, the first IPO of a microfinance institution in Africa. Run by a team of African professionals based in Johannesburg, the fund has earned a reputation as a value enhancer with a hands-on approach to management of portfolio companies.