Taking into account the provisions for governing bodies that apply under the ‘Freedom of Information Act’ (‘Wet openbaarheid van bestuur’) and the ‘Data Protection Act’ (‘Wet bescherming persoonsgegevens’), the Fund Manager of the DGGF part ‘Financing local SMEs’ will publish its anticipated transactions.
Views
Parties can express their views on the proposed transaction to the Fund Manager by contacting dggf@pwc.com within 30 days after the publication date of the notice. After the transaction has been closed, or after it has become clear that the transaction will not take place, the Fund Manager will respond as soon as possible to these Parties concluding on the expressed views by these Parties.
Description of proposed transaction
Part of DGGF
Financing Local SMEs
Name of Intermediary Fund (IF)
CardinalStone Advisers Growth Fund II (''CCAGF II'')
Domicile IF
CCAGF II is domiciled in Mauritius (main fund), with parallel vehicles in Nigeria and Ghana. The fund is structured as a limited partnership and is tax transparant.
Name of manager of the IF
CardinalStone Capital GP II Ltd (Mauritius)
Nature of the activities of the IF
CCAGF II is a 10-year closed-end private equity fund targeting growth-stage SMEs in Nigeria, Ghana, and up to 10% in Francophone West Africa. The Fund invests in six priority sectors: agribusiness, industrials, consumer goods and services, healthcare, education, and financial services. The Fund targets the equity gap between early-stage capital and larger mid-cap funds, addressing a persistent structural financing shortage for growth-stage companies in West Africa.
Size of proposed investment
Up to USD 9 million. With this investment DGGF is contributing to a target fund size of USD120 million.
Intended transaction date
The Fund Manager aims to close the Fund II in Q2 2026 (first close).
Expected financial results
A positive net financial return on the investment is expected.
Expected impact
CCAGF II targets impact across three pillars: (i) Shared Prosperity, focusing on inclusive growth and reducing inequality through job creation and access to quality products and services for underserved populations; (ii) Enhanced Equity, with a 2X-aligned gender lens targeting 30% of capital invested in female-led enterprises; and (iii) Environmental Sustainability, through portfolio company energy transition initiatives (solar adoption, import substitution, and resource efficiency). Primary SDG contributions: SDG 8 (Decent Work and Economic Growth) and SDG 5 (Gender Equality). Secondary contributions: SDG 7 (Affordable and Clean Energy), SDG 10 (Reduced Inequalities), and SDG 13 (Climate Action).
ESG compliance
To strengthen its ESG risk management, CCAGF II will adopt the DGGF exclusion list and integrate it into its investment process. As part of its ESG due diligence, CCAGF II will include the assessment of risks related to prohibition of violence and harassment, client protection, Politically Exposed People (PEPs), and fraud (incl. greenwashing and socialwashing), ensuring that these risks are identified and mitigated at an early stage. These updates will be incorporated into CCAGF II’s Environmental & Social Management System (ESMS) to ensure that all procedures for integrating ESG into the investment cycle are appropriately documented. Finally, after implementing the abovementioned requirements, CCAGF II will share the ESG due diligence documentation for its first two investments.
Tax compliance
DGGF will invest into CCAGF II, which will be a limited partnership domiciled in Mauritius. Consequently, CCAGF II will be deemed a pass-through entity and will not be subject to corporate income tax in Mauritius. Rather, investors in CCAGF II will be taxed in their jurisdiction of residence on their respective share of the investment income.
CCAGF II will invest in growth-stage SMEs across West-Africa, with a particular focus on Nigeria and Ghana. The SMEs in which CCAGF II will invest are in principle subject to the local statutory tax rates and CCAGF II will not make use of artificial constructions to lower its taxation or the taxation of the SMEs it invests in. CCAGF II requires the SMEs it invests in to comply with local laws and regulations, among others those regarding tax. DGGF’s conditions for investment focus on ascertaining that CCAGF II and its SMEs meet their ongoing tax obligations and the DGGF tax requirements.