Investment Firms Float $50m Microfinance Fund for Nigeria, Ghana
Nigeria, May, 07 2009 -
Alitheia Capital, in collaboration with its partners- Goodwell Investments BV and Ghana-based JCS Investments, yesterday, announced a $50 million (N7.4 billion) fund, aimed at lifting microfinance institutions (MFls) in Nigeria and Ghana.
The fund is expected to increase to $500 million (N74 billion) in future, as Alitheia and its partners expand their scope to other parts of West Africa.
Representatives of the firms explained in Lagos that Nigeria and Ghana were chosen because of "their big economies".
The objective of the fund, according to the partners, is to selectively invest in entrepreneurial MFls with the potential to generate attractive returns and positive social impact.
Present during the ceremony were the Managing Director of Alitheia, Mrs Tokunbo Ishmael, representatives of Goodwell (Holland), Els Boerhof and Wim Van der Beek, Edna Ishaya represented Adana Mamaki, while Patricial Safo was at the event on behalf of JCS.
In her contribution, Ishmael said: "We are very excited about this initiative because it provides the opportunity to positively impact on people at the base of the economic pyramid, while simultaneously rewarding our investors with positive returns.
"Our partner, Goodwell, has successfully built a similar microfinance investment portfolio in India, and we are confident that the success will be repeated in Nigeria in particular and West Africa in general."
Founding Partner of Goodwell Investments, Mr. Wim van der Beek, described the opportunities for the microfinance sector in West Africa as huge.
He added: "Our partners, Alitheia Capital and JCS Investments have strong teams with relevant experience and we look forward to working with them to pursue attractive equity investment opportunities."
The fund, according to the partners, will be invested in new MFls, to facilitate the creation of institutions based on best practices from inception.
Also, the group said it would work with existing MFls that have the potential for transformation but suffer from the typical MFI challenges- inadequate financing, shortage of skilled personnel and ineffective business model.
Already, Alitheia and its partners have carried out an extensive study on the opportunities for microfinance in Anglophone West Africa.
The findings of the study, covering Nigeria, Ghana, Liberia and Sierra Leone, are detailed in a report titled: "Emerging' Opportunity for Microfinance in West Africa."
The study is intended to attract investment to the microfinance sector in the region.
The report recounts the historical backdrop of the local industry, provides detailed estimates of current demand and supply scenarios and proposes strategies for plugging the gaps.
Alitheia Capital is an investment and advisory firm with emphasis on investments that have social and economic impact.
Information made available said the company is focused on private equity investments in businesses and private equity in real estate assets.