Canadian government-sponsored Africa fund closes at $212m

The Canada Investment Fund for Africa, a joint private-public partnership established by the Canadian government to facilitate foreign direct investment into Africa, has made a final close on $212 million (€166 million).

The private equity fund is managed by Actis, a UK-headquartered emerging markets private equity firm, and Cordiant, a Canadian investment management firm whose core activities include private equity investing in the emerging markets.

Among the investors committing capital to the fund are the Canadian International Development Agency, CDC Group, and private institutional investors based in North America, Europe and Africa. Roughly half of the committed capital is in the form of an anchor investment from the Canadian government.

CIFA will invest in mid-market private equity opportunities within a variety of sectors in the form of buyout, expansion-stage, privatisation and mezzanine transactions. The fund will invest in markets across the continent, with greater focus on South Africa, Nigeria, Egypt, Morocco, Algeria, East Africa and Francophone West Africa.

The fund has already invested in eight businesses to date, all of which have been co-investments alongside Actis’ $355 million Africa Fund II. These investments include Orezone, a gold mining business in Burkina Faso; Candax, a North African petroleum company; Banque Commerciale du Rwanda; and Peters Papers, a South African paper manufacturer.

“There is tremendous untapped value in Africa and our success in attracting new investors to the [f]und is a testament to the fact that people are recognising the opportunities available across the continent,” said Cordiant president and CEO David Creighton in a press statement. “This is a continent that will look substantially different in ten years and international firms are eager to participate in the growth.”

Actis and Cordiant announced in May 2004 that they had been selected by the Canadian Commercial Corporation to manage CIFA, following the initial announcement of the fund at the G8 Summit in June 2002. CIFA was created as a part of the Canada Fund for Africa, a C$500 million fund set up in response to the New Partnership for Africa’s Development.

Earlier this month, Actis announced the hire of former Go and Virgin Nigeria Airways founder Simon Harford to pilot its Nigerian operation and to head up the firm’s West Africa activities. Actis’ Africa activities are headed up by managing director Peter Schmid, who is based in Johannesburg.