Project detail - AFRICAN INFRASTRUCTURE INVESTMENT FUND IV

AFRICAN INFRASTRUCTURE INVESTMENT FUND IV

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Who is our client

African Infrastructure Investment Fund 4 (AIIF4) is a pan-Africa private equity fund focused on investments in digital, energy transition, and transport and logistics infrastructure. AIIF4 has a target fund size of $500-750MM and is managed by African Infrastructure Investment Managers (AIIM). Old Mutual Group, AIIM's owner and sponsor, will anchor, AIIF4 supported by FMO and two other European DFIs as first close investors.

Funding objective

AIIF4 plans to make 10-14 investments of control or significant influence in pan-African assets with core infrastructure characteristics and a focus on greenfield and growth opportunities (including but not limited to renewable energy generation; digital infrastructure including fiber, data centers, and communications towers; LPG distribution for end-consumer use in clean cooking; and roads, air-, and seaports).

Why we fund this project

Infrastructure development is a key driver for progress across the African continent and a critical enabler for productivity and sustainable economic growth. The Fund's strategy for energy transition assets, including investing in distributed generation renewables, is aligned with the energy transition in sub-Saharan Africa, and the Fund's strategy for digital infrastructure targets areas that are key to accelerating and modernizing sub-Saharan economies. By investing in AIIF4, FMO seeks to address the market need for infrastructure in sub-Saharan Africa in a sustainable and responsible manner.

Environmental and social rationale

The E&S categorization is A. AIIF4 is a pan-African private equity fund which focuses on making commercial investments in digital infrastructure, mobility and logistics and renewable energy. Approx. 35% of the pipeline includes greenfield investments. Due to the nature of infrastructure investments, E&S risks are likely to arise and need dedicated time and attention as IFC PS 1 through 8 can be triggered in these transactions. FMO has a long-lasting relationship with the fund manager, AIIM, who also manages the predecessor funds AIIF3 and AIIF2. AIIM has a qualified team of professionals dedicated to E&S topics, supported by a strong E&S Management System which has been developed over the last 8 years. Development Finance Institutions ? including FMO ? have played a significant role in the development of an ESMS that is operational and is revised regularly to incorporate the latest insights on ESG. FMO continues to engage frequently with the fund manager to monitor and give feedback to the fund?s E&S performance. In addition, FMO will keep engaging with AIIM on ways to add value and maximize impact together. More information on the fund manager of AIIF4 can be found on https://aiimafrica.com/sustainability/.

Region
Africa
Country
Africa
Sector
Infrastructure, Manufacturing and Services
Signing date
6/20/2022
Total FMO financing
USD 40.00 MLN
Fund
FMO
Risk categorization on environmental and social impacts, A = high risk, B+ = medium high risk, B = medium risk, C = low risk Environmental & Social Category
(A, B+, B or C)
A