Africa50 is a platform for infrastructure investment that helps Africa’s progress by designing and investing in bankable projects, stimulating public sector capital, and mobilizing private sector funding with differentiated financial returns and impact.
Africa50 promotes project development and channels private investor funds into well-structured infrastructure projects. It prioritizes high-impact national and regional projects, primarily in the energy and transportation sectors, that have a significant development impact while giving a reasonable financial return. Africa50, through its independent project development and equity financing entities, can give assistance at all stages of the project cycle. Africa50’s Project Development division follows a venture capital strategy, employing risk capital in the early stages. Investments range from $2 million to $10 million. It aims at a moderate return on investment on a portfolio basis to maintain sustainability while balancing profitability and development impact.
Africa50 often takes major minority holdings in projects or platforms and collaborates actively with the primary sponsor (except for surrogate sponsor engagement). When feasible, it collaborates with other developers to enhance the value proposition. The initiative supports projects ranging in size from medium to big, with an average cost of more than $20 million. The funding ranges from $2-10 million for project development through financial close. Following that, the Africa50 Project Finance arm can provide equity and quasi-equity for projects worth more than $20 million. The project will help and support public, private, and public-private partnerships.
Africa50 identifies projects through its network and shareholders, engaging players throughout the deal cycle through partnerships with governments and private-sector partners to identify and address problems that prevent projects from reaching financial close. It reduces risk through creative structuring and financial analysis. Forming the project concept, conducting feasibility studies (technical, ESG, business, and legal), acquiring land, obtaining approvals and permits, contract negotiation and structuring (offtake, EPC, O&M), financing, guarantees, and financial close is all part of the project cycle. Interested investors or partners should contact Africa50 with a short, preliminary project proposal that includes, but is not limited to, information on funding sources, sector experience, and potential partners. Projects must be on a medium to large scale and must be national or regional in scope. They must be commercially and environmentally viable, have a major development impact, and provide investors with a reasonable return. Sectors to be covered under the initiative are Power generation/renewable sources, Power generation/non-renewable sources, Gas distribution, Logistics, Road transport, Ports, Air transport.
The countries involved or investing in the Africa50 initiative are Algeria, Egypt, Libya, Mauritania, Morocco, Tunisia, Benin, Burkina Faso, Cape Verde, Côte d’Ivoire, Gambia, Ghana, Guinea, Guinea-Bissau, Liberia, Mali, Niger, Nigeria, São Tomé & Príncipe, Senegal, Sierra Leone, Togo, Burundi, Comoros, Djibouti, Eritrea, Ethiopia, Kenya, Rwanda, Seychelles, Somalia, Sudan, South Sudan, Tanzania, Uganda, Cameroon, Central African Republic, Chad, Congo-Brazzaville, Democratic Republic of Congo, Gabon, Angola, Botswana, Lesotho, Madagascar, Malawi, Mauritius, Mozambique, Namibia, South Africa, Swaziland, Zambia, and Zimbabwe.
Africa50 has established the Africa50 Infrastructure Acceleration Fund, a new fund targeted at accelerating investment in African infrastructure. The fund’s goal is to raise $500 million in numerous closings. The Fund is the product of Africa50’s long-term endeavour to raise more cash to help bridge Africa’s infrastructure finance deficit.
The Fund’s mandate is to provide attractive risk-adjusted returns to institutional investors seeking exposure to African infrastructure assets while also playing an important role in financing medium and large-scale infrastructure projects in Africa.
While the Fund will generate its own investment possibilities and make its own investment decisions, it is also expected to look into co-investment options with Africa50. It will make use of Africa50’s capabilities in critical areas such as deal flow development, project development, and project financing, as well as Africa50’s extensive networks on the continent and globally, as well as strong African government contacts. The Fund plans to invest in the electricity, transportation, information and communications technology (ICT), midstream gas, health, and education sectors.
Power Grid Corporation of India Limited (POWERGRID) has signed a Joint Development Agreement with Africa50, a pan-African infrastructure investment platform, to continue the development of the Kenya Transmission Project through public-private collaboration.
Under a public-private partnership (PPP) framework, the project involves the development, funding, building, and operation of the 400kV Lessos – Loosuk and 220kV Kisumu – Musaga transmission lines. When finished, the project will be Kenya’s first Independent Power Transmission (IPT) and will create a precedent in Africa as the first PPP financing of transmission lines. This project will also improve the supply and reliability of power transmission in Western Kenya, as well as serve as a demonstration effect to encourage private sector investment in the expansion of Africa’s power transmission networks, which is critical to closing the continent’s electricity access gap.
POWERGRID, one of the world’s leading electric transmission utility firms, will give technical and operational know-how to the project, while Africa50 will bring project development and finance knowledge and will function as a bridge between the Kenyan government and private investors. The signing of this agreement demonstrates POWERGRID and Africa50’s willingness to continue devoting resources to speed project development operations until financial close.
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