Zebu’s Africa Food Security Fund (a DGGF investee) reaches total fund size of USD 84 million
DGGF was part of the initial group of investors committing to the Africa Food Security Fund managed by Zebu Investment Partners. The fund has now secured the commitment of an additional investor, reaching a total fund size of USD 84 million.
The Africa Food Security Food will invest in SMEs operating across the food value chain. The SME emphasis has attracted a healthy pipeline of companies that require transformational capital to finance their next stage of growth. From primary to tertiary food value chains, Africa has significant potential to address its food security issues and eventually export surplus output to the rest of the world. It is envisaged that the Fund’s impact orientation in its investment process will result in significant job creation and development potential, with emphasis on women and youth employment as well as strong support for smallholder farmers by designing sustainable out-grower networks.
Zebu Investment Partners, the specialist investor focused on improving food security in sub-Sahara Africa, has achieved an initial close for its sophomore fund, the Africa Food Security Fund (‘AFSF’). This strong representation reflects the combination of Development Finance Institutions, Pension Funds, and Fund of Funds, that are increasingly making allocation to improving food security on the continent. AFSF is targeting commitments of at least $100m at final close.
The first round of investors includes the Public Investment Corporation (PIC) on behalf of the Government Employee Pension Fund (GEPF) of South Africa, the Africa Development Bank (AfDB), headquartered in Cote D’Ivoire, CDC Group of the UK, Dutch Good Growth Fund (DGGF) of the Netherlands, Investeringsfonden for Udviklingslande (IFU) of Denmark, and Ecowas Bank for Investment & Development (EBID) based in Togo. Kuramo Capital Management of USA, subsequently joined to bring the fund commitment to $84 million.
The Africa Food Security Food will invest between $2m and $8m in SMEs operating across the food value chain, with emphasis on building synergies through platform strategies by focusing on distribution, inputs, primary and secondary value addition. Its pan-African emphasis will give Zebu Investment Partners access to a wide range of opportunities to deliver impact and create commercial value for both portfolio companies and its investors. Zebu will aim to invest in companies that also improve financial inclusion and climate change themes.
With a sharper focus on Sub-Saharan Africa and relying on its presence in South Africa, Ghana and Mauritius, the Fund will invest in underserved countries. It is envisaged that the Fund’s impact orientation in its investment process will result in significant job creation and development potential, with emphasis on women and youth employment as well as strong support for smallholder farmers by designing sustainable out-grower networks.
Following the successful deployment of its predecessor fund, the AAF-SME, the SME emphasis has attracted a healthy pipeline of companies that require transformational capital to finance their next stage of growth. From primary to tertiary food value chains, Africa has significant potential to address its food security issues and eventually export surplus output to the rest of the world.
Commenting on the outcome of the first close, Dennis Matangira, Senior Managing Partner, indicated that “Given the quality of opportunities that we continue to identify in the SME space, the combination of patient capital from our investors and technical assistance helps to complete the funding gap that we experience in sub-Sahara Africa”.
Brian Frimpong, Managing Partner, emphasized that “we believe additional investor commitments will take us beyond our target size, which will enable the fund to channel more resources to underserved SMEs in Africa and to pursue its mandate on building sustainable and successful portfolio companies in Africa”.
Press contact detail:
- Brian Frimpong, Managing Partner,
+233 (0) 302 632 222
bfrimpong@zebuinvestments.com