Investment & Finance
AIIM’s pan-African infrastructure fund gets USD80m capital increase
The fund has invested in renewable energy projects in various African countries
Cape Town – The flagship pan-African infrastructure fund of African Infrastructure Investment Managers (AIIM), AIIF3 (African Infrastructure Investment Fund 3), has successfully completed a capital increase of USD80m. The capital increase takes the total commitments for AIIF3 to USD400m and represents one of the largest capital raises closed for an African fund since the advent of the COVID-19 pandemic.
We are delighted with the continued faith placed in AIIM’s strategy for AIIF3 by some of the most experienced African fund investorsPaul Frankish, Investment Director at AIIM
The African Infrastructure Investment Fund 3 targeting energy and infrastructure investments
The establishment of AIIF3 was continue the mandate and strategy developed for AIIM’s AIIF2 fund. The fund will be specifically targeting infrastructure investments in the power, transport, digital infrastructure and midstream energy sectors across sub-Saharan Africa.
To date, the fund has concluded investments in nine assets, with the additional commitments expected to be deployed across a further two transactions in the energy and digital infrastructure sectors as well as the growth requirements for existing platforms within the portfolio.
“AIIF3 continues its strategy of targeting mid-market opportunities, focusing on executing deals in the USD 20m-60m range – a space we believe is less competitive and carries less execution risk than some of the large-cap deals. This allows us to consider strategic deals in countries with high-growth prospects and sectors that have shown greater resilience to COVID-19 impacts, without being limited to a smaller grouping of countries with the scale to support mega deals,” said Paul Frankish, Investment Director at AIIM
Mid-market deals with short construction periods make the fund yield quicker
Supported by the focus on mid-market deals with shorter construction periods, seven of the assets in the AIIF3 portfolio are already operational and delivering in line with their original investment thesis, with a further two assets expected to commence commercial operations in early 2021, moving the fund into the yielding stage.
The fund has invested in renewable energy projects Nigeria, Burkina Faso, Guinea, Kenya among other African countries.
AIIF3 achieved its first close in May 2017 with four subsequent closes concluded before a final close in May 2019. The capital increase was open to existing LPs and closed in mid-November 2020.