The African Development Bank signed off on its €12.5 million equity investment in Adiwale Fund 1, a first-generation private equity fund targeting high growth potential Small and Medium-Sized Enterprises (SMEs) in francophone West Africa.
The Bank Group’s board of directors approved the investment in March as part of its commitment to grow SMEs and improve livelihoods in countries underserved by the global equity market.
With a target fund size of €75 million, the Fund will take minority stakes in vibrant SMEs in countries where economic prospects and the Fund’s networks permit a rapid scale-up.
Deal size for the Fund will range from €3 to €8 million. Primary target countries will include Cote d’Ivoire, Senegal, Burkina Faso and Mali, while secondary beneficiaries will include Togo, Benin and Guinea.
Across these economies, some of which are fragile states, the Fund will target three sectors: consumer goods and services, including education and health; business services such as transport, logistics, information technology and construction, and manufacturing, including pharmaceuticals, agri-processing and chemicals.
Abdu Mukhtar, Director for Industrial and Trade Development said the Fund’s investment strategy is aligned with the Bank’s High 5 goals especially ‘Industrialize Africa, Integrate Africa and Improving the Quality of Life for the People of Africa’.
From a development perspective, the Bank’s equity investment will provide growth capital to African SMEs, resulting in spillover effects on job creation and tax revenues, with about 45% of the jobs going to women, Mukhtar said.
Original source: AfDB
Published on 18 October 2019
