Investec gets nod to manage $670m emerging Africa infrastructure fund

Investec Asset Management on Tuesday announced that it has been appointed to manage the $670 million Emerging Africa Infrastructure Fund (EAIF).

The Fund is a public-private partnership anchored by the governments of the UK, The Netherlands, Sweden and Switzerland.

EAIF, an initiative of the donor-financed Private Infrastructure Development Group, was developed to mobilise capital into private sector infrastructure projects across sub-Saharan Africa.

Since its establishment in 2002, the fund has committed over US$1.2 billion to 63 projects in 19 countries.

Lenders include a combination of private sector financial institutions and development finance institutions, aside the sovereign contributos.

Hendrik du Toit (pictured), CEO, Investec Asset Management, said: “The private sector has a crucial role to play in unlocking the conditions for the sustainable, long-term development of Africa’s infrastructure.

“A major initiative of its kind globally, this fund aims to provide growth capital, expertise and support to these projects with the aim of stimulating economic development, encouraging growth and employment, and fuelling Africa’s long-term development.”

Investec got the not after a competitive tender process that brought interest from over 30 companies across the globe.

Investec Asset Management’s pan-African investment expertise has continued to deepen, following the recent launch of the Growthpoint Investec African Properties platform to invest in pan-Africa real estate, and the recent closure of its second Africa private equity fund.

David White, chair of EAIF, said the Fund has established itself as a market leader in infrastructure finance in Africa and “is now ready to be a bigger and more potent force in the economic development of sub-Saharan Africa”.

“We were impressed with Investec Asset Management’s determination and agility, its commitment to our core mission and its belief in a successful future for Africa. Their appointment as the Fund’s manager means that we now have the final element in place to power our growth strategy. Africa is Investec Asset Management’s home territory. From African roots it has built a worldwide business and a demonstrable track record as a good corporate citizen,” White said.

“The people responsible for EAIF’s recent success will continue their outstanding work at Investec Asset Management, which is inheriting a team that is greatly respected, deeply knowledgeable and uniquely skilled.”

As one of the largest third party investors in private equity, credit, public equity and sovereign debt across the African continent, Investec Asset Management will integrate the Fund and its existing team into its African investment platform which includes over 73 Africa-focused investment professionals.

Of its total $109 billion AUM, the firm manages investments in Africa (including South Africa) of $30 billion.

The Fund, according to the press statement, aims to achieve three main objectives – to catalyse African infrastructure projects through providing long-term debt and mezzanine finance on commercial terms tailored to local needs; to invest in sustainable businesses with skilled management teams and clear potential to improve economies and help reduce poverty; and to deliver on both investment and specific development goals.

Nazmeera Moola, Co-Head of Africa Fixed Income at Investec Asset Management, who will head EAIF operations, said: “The large demand for funding on the continent and the necessity for effective infrastructure development provides a strong investment backdrop. This offers a compelling entry point into the long-term African growth story. We are very well positioned to take advantage of these opportunities with our extensive experience of investing in emerging markets, underpinned by our heritage, which gives us deep insight into the drivers of African markets.”

Investec Asset Management will manage the entire process from seeking out projects, evaluating loan applications, carrying out due diligence and managing the administration of transactions.

Investec Asset Management will also market the Fund internationally and monitor the loan portfolio.