CDC Group plc (“CDC”), the UK’s development finance institution and impact investor, has announced a EUR25mn commitment to Mediterrania Capital Partners III (MCP III), a generalist fund primarily targeting investments in North Africa.
North Africa is home to a new generation of entrepreneurs, some of whom have longstanding roots in the region, and others who are taking advantage of new opportunities offered by burgeoning regional growth.
However, lack of finance is a persistent barrier for business owners seeking to grow their companies both regionally and internationally.
CDC’s investment will enable MCP III to invest in companies that have strong local brands and established customer bases, with the potential to become regional leaders and achieve further revenue growth and operational efficiencies.
In turn, this will help create new direct and indirect jobs, particularly for semi-skilled and unskilled workers in a region where youth unemployment is high.
The fund has already made four investments, including Cairo Scan, a radiology and lab services provider in Egypt, and COFINA, a provider of financial services predominantly active in Cote d’Ivoire.
CDC’s Head of African Funds, Clarisa De Franco said:
“Our investment in MCP III will support well-established local firms that demonstrate strong potential for growth to become regional leaders, providing the capital and expertise for them to expand. This investment allows us to begin a partnership with a team which has the potential to become a leading mid-cap pan-African fund manager.”
Albert Alsina, Founder and CEO, Mediterrania Capital Partners added:
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“We are very excited to have CDC Group joining Mediterrania Capital III, our third fund with a focus on SMEs and mid-cap companies in Africa. Thanks to CDC and the other investors’ contributions we will be able to continue helping local entrepreneurs to build businesses with strong foundations and reach their next level of growth.
“MC III has already invested in five companies in Morocco, Tunisia, Egypt and Côte d’Ivoire, in fast-growing sectors such as construction, healthcare, microfinance and retail. Mediterrania Capital Partners seeks to create value through sustainable and socially responsible investments that improve economies and the life of local communities in Africa.
“Having CDC Group on board allows us to continue investing in assets with a strong potential for financial returns and ESG impact.”