AfricInvest Group partners with FMO, MicroVest II, LP & Finnfund to form SFC Finance

22 Jul 2014

AfricInvest, along with FMO, MicroVest II, LP and Finnfund, is delighted to announce the creation of SFC Finance, a lender to African small and medium enterprises (SMEs). SFC Finance will commence operations with committed shareholders’ equity of $20 million and an initial $50 million debt facility extended by the Overseas Private Investment Corporation (OPIC). Final arrangements for both the shareholders’ equity and the debt were concluded on April 30, 2014.

SFC Finance will focus on lending to successful African SMEs in need of funding for growth or expansion, as a senior secured lender. It will structure financial offerings with tenors adapted to the cash generation capabilities of its customers. Understanding that medium-­‐sized African businesses typically have different collateral to offer than their larger counterparts, SFC will work with them on a flexible basis to ensure that deserving borrowers have access to appropriate debt financing. SFC will also work with FMO, one of its key shareholders, to provide technical assistance to its customers.

Mr. Aziz Mebarek, a Founding Partner of AfricInvest Group and an SFC Finance board member, recently stated, “In its private equity activities over the past 20 years, AfricInvest has recognized the frequent lack of appropriate debt financing for SMEs, particularly the lack of credit facilities with repayment schedules that reflect company cash flows, a factor which has inhibited their growth. Credit-­‐worthy SME borrowers without adequate access to debt finance exist in most sub-­‐Saharan African markets. As a new source of financing, SFC Finance will address these needs.”

Mr. Michael Barth, SFC Chairman and an independent director, noted, “It is not just about financing promising growth projects in Africa. I expect that SFC will contribute in substantive ways toward improving SME governance and environmental and social responsibility. This also reflects our commitments to our shareholders and lenders to ensure that SFC’s customers implement sound and sustainable business practices.”

Total Impact Advisors acted as an advisor and placement agent for the transaction.

For more, see here.

Source: AfricInvest Group.

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