Google, Mitsui join African telco fund in $100m deal

The IFC is also part of the team that will invest in broadband company CSquared alongside Convergence Partners.

A quartet comprising Convergence Partners, Google, the International Finance Corporation and Mitsui & Co is set to deploy a combined $100 million into CSquared, a wholesale broadband business headquartered in Nairobi.

The company, initially founded by Google under the name of Project Link, is a carrier-neutral, open access provider of high-speed fibre optic in Sub-Saharan Africa. Its network currently spans Uganda (with 800km in Kampala and Entebbe) and Ghana (840km in Accra, Tema and Kumasi).

“The introduction of the new partners will accelerate growth of the existing operations and plans for expansion into further markets,” Convergence said.

“Its disruptive model of deploying and operating infrastructure on an open access, shared basis will be instrumental in delivering commercial and developmental benefits through the unlocking of pervasive broadband access,” added Andile Ngcaba, the firm’s chairman.

Convergence’s investment will be made via Partners Communications Infrastructure Fund, a $200 million vehicle focused solely on African telecom infrastructure which the firm bills as the only one of its kind on the continent. The vehicle, which had a $250 million original target size, reached a final close in July 2015, after a $145 million first close in November 2013.

Cornerstone investors in the vehicle include the IFC, the European Investment Bank, the Dutch Development Bank, the Development Bank of Southern Africa and the UK’s CDC Group.