Ninety One in Benin deal

03 Aug 2020

Private Infrastructure Development Group (PIDG) company, the Emerging Africa Infrastructure Fund (EAIF), has announced that it is progressing its due diligence as the sole lender to a €36 million, 25MW natural gas-fuelled power station project, to be built by the Nigerian company, Genesis Holdings, at Maria Gleta, near Benin’s capital of Porto Nova. EAIF is providing €27 million of long-term debt. Financial close is expected in Q1 2021, with construction forecast to begin shortly afterwards. The project is EAIF’s first in Benin.

A key element in helping to assess the financial viability and bankability of the project is a returnable grant of US$ 449,250 provided by PIDG Technical Assistance.  It funds part of the development expenses that were mainly financed by Genesis. The PIDG funds also helps meet the cost of the rigorous due diligence process that is required on all projects seeking support from PIDG and its companies.

Emilio Cattaneo, Head of Technical Assistance at PIDG TA, says,

“Early stage financial support not only helps make infrastructure projects more viable, but also strengthens investor confidence at the project financing stage.”

Akinwole Omoboriowo II, Chairman Board of Directors of Genesis Holdings, says;

“EAIF brought us its very deep knowledge of financing power stations across Africa and introduced us to PIDG Technical Assistance. The help we received there gave our business modelling and projections strong foundations, adding to EAIF’s confidence in the project.”

Akinwole Omoboriowo went to thank the Government of Benin, which he says has created a welcoming investment climate and is committed to growing Benin’s power generation sector and delivering better energy security.

GENESIS’ co-development partner and an equity investor in the Maria Gleta project is the Johannesburg-based Pembani Remgro Infrastructure Fund (PRIF). PRIF is an equity investor across Africa in infrastructure projects and allied businesses. GENESIS says that PRIF has made a key strategic contribution to accelerating achieving a strong financial foundation and corporate structure for the project.

Ravi Kalaichelvan, an investment director at PRIF says;

“We are pleased to partner GENESIS and EAIF in the Maria Gleta development. It will be an asset that will further aid the sustainable growth of Republic of Benin.”

Roland Jannsens, a director at EAIF’s managers, Ninety One, says

“EAIF is a patient lender that understands the time and great efforts needed to transform lives and economies. We are delighted that EAIF and PIDG Technical Assistance have been at the centre of bringing Benin and its people new infrastructure that will help create a more competitive economy for the country.”

Increasing Benin’s base load generating capacity will significantly improve the country’s ability to attract investment from local entrepreneurs and internationally mobile capital.  Independent data shows that some 42% of the 11.5 million people of Benin have access to electricity. Ongoing investment in uniting the transmission lines of the electricity grids in north and south Benin and linking it to neighbouring countries is a factor in promoting investment in the generation sector. [Classified as a low-income country, Benin is ranked 163rd out of 189 on the 2019 UNDP Human Development Index, up three places since 2015.]

 

About EAIF

The Emerging Africa Infrastructure Fund provides a variety of debt products to infrastructure projects promoted mainly by private sector businesses in Africa and parts of the Levant. The Fund helps create the infrastructure framework that is essential to sustained economic stability, business confidence, job creation and poverty reduction.  It has to date supported 75 completed  infrastructure projects across nine sectors in over 20 African countries. As of the end of 2018 the Fund had invested US$20.082 billion. EAIF is part of PIDG. EAIF was established and substantially funded by the governments of the United Kingdom, The Netherlands, Switzerland, and Sweden. It raises its debt capital from public and private sources, including Allianz, the global insurance and financial services company; Standard Chartered Bank; the African Development Bank; the German development finance institution, KFW,and FMO, the Dutch development bank. EAIF is managed by Ninety One.

www.eaif.com

About PIDG

 The Private Infrastructure Development Group (PIDG) is an innovative infrastructure development and finance organisation which encourages and mobilises private investment in pioneering infrastructure in the frontier markets of sub-Saharan Africa and south and south-east Asia to promote economic development and combat poverty. PIDG delivers its ambition in line with its values of opportunity, accountability, safety, integrity and impact. Since 2002, PIDG has supported 157 infrastructure projects to financial close and provided 209 million people with access to new or improved infrastructure. PIDG is funded by six governments (the UK, the Netherlands, Switzerland, Australia, Sweden, Germany) and the IFC. PIDG TA can provide technical assistance and capital grants to the PIDG companies to meet a range of needs associated with an infrastructure project’s life-cycle. PIDG TA can also provide up-front viability gap funding grants to support PIDG projects that require concessional funding to make a project with strong development impact financeable.

 

www.pidg.org

About Ninety One 

Ninety One is one of the largest third party investors in private equity, credit, public equity and sovereign debt across the African continent. The Emerging Africa Infrastructure Fund (EAIF) is managed by and fully integrated into Ninety One’s African investment platform. Ninety One manages the entire process on behalf of the EAIF. It markets the Fund, seeks projects, evaluates loan applications, including due diligence, manages transaction administration and monitors the loan portfolio. Since May 2016, when it was awarded the management mandate, Ninety One and its EAIF team have closed over 20 infrastructure transactions with a capital value of USD 650m.  The team also led EAIF’s last round of fundraising, raising US$385 million, including US$100 million from Allianz Global Investors and US$50 million from Standard Chartered, a long-standing lender to EAIF.

 

Ninety One is  an independent, active global asset manager listed on the London and Johannesburg stock exchanges. Established in South Africa in 1991, as Investec Asset Management, the firm was a pioneer in emerging markets in Africa. In 2020, almost three decades of organic growth later, the firm de-merged from Investec Group and became Ninety One. Today, Ninety One offers distinctive, active strategies across equities, fixed income, multi-asset and alternative investments to institutions, advisors and individual investors around the world.

About Pembani Remgro Infrastructure Fund

The Pembani Remgro Infrastructure Fund is a joint initiative established by Remgro, Phuthuma Nhleko and the investment team, based in Johannesburg. The strategy of the fund is to invest equity and quasi-equity in the full spectrum of infrastructure opportunities on the African continent, with a focus on sub-Saharan Africa. This includes investments in greenfield transactions; brownfield and secondary transactions; as well as logistics and engineering services companies operating within the infrastructure sector. For more information visit www.pembani-remgro.com.

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