Business Daily

21 February 2022

• Mobilised funds increase by 30%
• New commitments in Latin America rise significantly
• New business strategy: even stronger focus on impact and climate

DEG – Deutsche Investitions- und Entwicklungsgesellschaft mbH can report a successful financial year in 2021. Despite the ongoing coronavirus pandemic, it was finally able again to commit more funds than the previous year – some EUR 1.5 billion, compared with EUR 1.4 billion in 2020 – to finance private investments in developing and emerging countries. It also mobilised EUR 507 million from other capital providers, over 30% more than in 2020. The DEG portfolio grew to EUR 9.2 billion (2020: EUR 8.5 billion).

“The pandemic continues to create challenging conditions in many of our partner countries. It is therefore all the more gratifying that an initial assessment of the development impact of our investments shows that customers are weathering the crisis better than expected. In 2021, for example, the companies we co-financed in developing countries employed 2.8 million people and generated EUR 147 billion in local income,” explained Roland Siller, CEO of DEG.

At EUR 737 million, financing for small and medium-sized enterprises again accounted for around half of DEG’s new business. In this way, DEG helped improve the shortage of long-term financing for such companies in many developing countries.

On a regional breakdown, Latin America saw a particularly sharp increase in financing commitments, up almost 70% year on year to EUR 566 million (2020: EUR 334 million). DEG used these funds in countries in the region particularly affected by the pandemic to help local SMEs obtain capital and continue operating. Around one-third of new financing commitments went to Asia, followed by Africa and Europe.

In addition to providing financing from its own funds, DEG offers advisory services and promotional programmes. For instance, it facilitates Business Support Services that boost the development impact of co-financed investments, as well as feasibility studies and pilot projects. In 2021, via its advisory and promotional programmes, DEG committed EUR 62 million for 179 projects, a high proportion of which again related to Covid-19 Response measures in health and prevention.

Through the AfricaConnect programme launched in 2019, DEG committed EUR 46 million in 2021 (2020: EUR 40 million) to investments of European companies in Africa, such as medical diagnostics in Côte d’Ivoire.

Global challenges, such as climate change, sustainability requirements and digitalisation, are changing markets and potential around the world. Against this background, DEG has developed a focussed business strategy for implementation in 2022. “Together with our customers, we want to develop solutions for dealing with global challenges. To achieve this, we will have an even sharper focus in the future on high-impact and climate-friendly investments and will continue expanding our advisory services. We see great potential in guiding companies wishing to tackle the transformation with our support,” commented CEO Roland Siller. In addition to providing debt and equity capital, DEG will continue enhancing the advisory services it provides companies on impact and climate change.

17 February 2022

• The ZAR 11.6 billion Redstone concentrated solar power (CSP) project to power 200,000 households upon completion

• Commercial operation scheduled to start in Q4 2023

• DEG provided a commitment of ZAR500m to the transaction.

At ZAR 11.6 bn total investment, the largest renewable energy investment in South Africa to date, the Redstone concentrated solar power (CSP) project has achieved its first debt drawdown.

Located in the Northern Cape Province of South Africa, the Redstone project will be equipped with a 12-hour thermal storage system that will deliver clean and reliable electricity to nearly 200,000 households round the clock. Commencement of operations is scheduled for Q4 2023. Through the successful mobilisation of international project finance, Redstone CSP has facilitated approximately ZAR 7 billion in foreign direct investment to fund and support the strategic energy transition goals of the country.

“In support of Sub-saharan Africa’s First CSP Molten Salt Tower Plant and the Renewable Independent Power Producer Programme (“REIPPP”), DEG approved a senior local currency loan of ZAR500m to its longstanding client ACWA Power. As such, DEG continues to play an active role in facilitating private sector investment into grid-connected renewable energy generation in South Africa”, commented Andreas Cremer, Head of Project Finance for Africa/Latin America at DEG.

The project has secured financing from leading international and South African financial institutions including African Development Bank (AfDB) who acted as the coordinating bank, Development Bank of Southern Africa (DBSA), CDC, FMO, ABSA Bank, Nedbank, Investec Bank, Sanlam Life Insurance and the Industrial Development Corporation of South Africa (IDC).

Redstone CSP will offset an estimated 440 metric tons of CO2 emissions per year while also providing value-adding ancillary services to Eskom, being the first renewable energy project to offer such services in the country. The project is certified under the Climate Bonds Standard and Certification Scheme and aligned with the goals of the Paris Climate Agreement which seeks to limit global warming to under 2 degrees Celsius. In addition to efficiently delivering clean energy to the national grid, the Redstone project will also offer tangible socio-economic value through offering job opportunities and utilising local supply chains. The project will reach close to 44% local content on procurement during the construction period; create more than 2,000 construction jobs at peak, with about 400 from the local community; and create approximately 100 permanent direct jobs during the operating period.

The project is led by ACWA Power, a leading Saudi developer, investor and operator of power generation, water desalination and hydrogen plants in 12 countries, who is also the lead shareholder in the project. ACWA Power’s co-shareholders in the project include the Central Energy Fund, Pele Green Energy and the local community.

The construction is well underway and is currently in the ninth (9th) month of construction. The engineering works for the project is over 58% complete, whereas procurement and construction work stand at over 45% and 6% respectively. The tower foundation – a key construction milestone for the project has already been completed.

16 February 2022

London, 15 February 2022 – CDC, the UK’s development finance institution that will soon be renamed British International Investment (BII), has appointed four new managing directors.

The appointments have been made as CDC/BII enters its new five year strategy period in which it will prioritise investment in clean infrastructure and climate finance projects.

Amal-Lee Amin, CDC’s Climate Change Director, becomes MD and Head of Climate. Dr Amin has led cross-firm initiatives to align investment strategies with the goals of the Paris Agreement. She has also positioned CDC/BII as a leader among the development finance community on climate finance, particularly the agenda for accelerating private investment for climate adaptation and resilience.

Chris Chijiutomi, Director, Head of Infrastructure Equity, becomes MD and Head of Infrastructure Equity, Africa and Pakistan. Mr Chijiutomi has led CDC’s Infrastructure Equity team since 2018 and in that capacity has been responsible for some of the company’s most important relationships and transactions. He sits on the boards of Globeleq and Gridworks, CDC’s key investments in Africa power. He also provided overall leadership and supervision of CDC’s joint venture with DP World in the creation of a platform to invest in ports and logistics assets in Africa.

Yasemin Saltuk Lamy, Deputy CIO, Head of Asset Allocation and Capital Solutions becomes MD and Head of Asset Allocation and Capital Solutions. Under Ms Lamy’s leadership since 2018, CDC’s Catalyst portfolio has doubled in size, reaching $1 billion of commitments and helping more than 40 million people. In 2020, she stewarded CDC’s COVID-19 response, which was awarded Real World Impact Initiative of the Year by the UN Principles for Responsible Investment.

Abhinav Sinha, Director and Head of Technology and Telecoms, Equity, becomes MD and Head of Technology and Telecoms. Since joining CDC in 2018, Mr Sinha has been responsible for leading his teams on some of the most significant investments at CDC/BII. These have included Liquid Telecom, the largest independent fibre and cloud service provider in Africa, the mobile partnership with Vodacom in Ethiopia and setting up Kelix bio, the cross-border pharmaceutical manufacturing platform.

Nick O’Donohoe, Chief Executive at CDC/BII, said: “Each of our four new Managing Directors have demonstrated outstanding performance, skill and dedication to our values. They will play a key role in delivering BII’s strategy over the new five year strategic period.”

About CDC/BII
1. CDC will formally become British International Investment plc on 4 April 2022.

2. British International Investment is a reliable and trusted investment partner to businesses in Africa, parts of Asia and the Caribbean. It will commit between £1.5 and £2 billion per annum between 2022 and 2026 to support the UK government’s Clean Green Initiative and to create productive, sustainable and inclusive economies in Africa, parts of Asia and the Caribbean.

3. British International Investment plays a key role in the UK government’s wider plans to mobilise up to £8 billion a year of public and private sector investment in international projects by 2025.

4. Over the next five years, at least 30 percent of BII’s total new commitments by value will be in climate finance. This will make us one of the world’s largest climate investors in Africa.

5. BII is also a founding member of the 2X challenge which has raised $10bn to empower women’s economic development.

6. The company has investments in over 1,000 businesses in emerging economies and total assets of £6.8 billion.

14 February 2022

Johannesburg, South Africa, February 10, 2022—To support growth in South Africa’s digital economy and increase access to financing for the country’s tech entrepreneurs, IFC has invested in Knife Fund III, a new fund managed by Cape Town-based venture capital firm Knife Capital.

IFC’s $10 million investment in Knife Fund III will provide financial support to tech startups in high-growth sectors in South Africa with strong potential for expansion across Africa and internationally, including enterprise technology, software, health-tech, and fintech.

Knife aims to raise $50 million for Fund III, which will primarily target investments in the series B (second round of funding) stage. Fund III follows Knife Fund II, which was launched in 2016, and Fund I, which was launched in 2010.

"We are excited to welcome IFC as an investor to our new Fund III and sincerely appreciate the endorsement that comes with the commitment," said Andrea Bohmert, Partner at Knife Capital. "With the first close of Fund III, we are finally able to support entrepreneurs on the next stage of the scale-up journey and thereby address a significant gap that currently exists in the African entrepreneurial ecosystem."

"Increasing access to venture capital promotes digital entrepreneurship and innovative tech solutions that enable better delivery of vital services such as healthcare, fintech, and logistics," said Adamou Labara, IFC’s Country Manager for South Africa. "By supporting funds such as Knife III, IFC can help more startups and digital entrepreneurs innovate and expand in South Africa and beyond."

According to the IFC-Google report eConomy Africa 2020, South Africa’s Internet economy has the potential to grow in size from $21 billion to $31 billion between 2020 to 2025—and up to $125 billion by 2050. To support this growth, it will be critical to provide local tech startups with the capital they need to launch and scale their products and services.

In South Africa, the level of fundraising volume is relatively high compared to the rest of sub-Saharan Africa, but most venture capital supports early-stage companies in the country, with limited funding available for Series B or later stages of investment.

IFC’s investment in Knife Fund III aligns with its strategy to provide patient risk capital to fund managers in Africa and to support Africa’s technology ecosystem.

About IFC

IFC—a member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2021, IFC committed a record $31.5 billion to private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of the COVID-19 pandemic. For more information, visit www.ifc.org.

17 February 2022

Freterium raises $4 million Seed
Morroco-based digital trucking software startup Freterium, has raised $4 million in a Seed round led Partech, with participation from Y Combinator, Flexport, CDG Invest, Swiss Founders Fund, Outlierz Ventures, and angels from the US, Europe, Asia, and Africa.
Founded in 2020 by Mehdi Cherif Alami (CEO) and Omar El Kouhene (CPO), Freterium connects shippers to the different parties involved in the logistics ecosystem, enabling all supply chain actors to collaborate easily and verify order traceability. The startup currently works with over 20 enterprises and caters to more than 3,000 users.
The startup plans to use the funds to invest in its tech and product development to fuel growth and serve more companies in Africa and the Middle East.
Press release

Morocco-headquartered Transport Management Software provider Freterium announced today that it has raised $4M in its latest funding round closed in December. The SEED round was led by Partech, with Y Combinator, Flexport, CDG Invest, Swiss Founders Fund, Outlierz Ventures, and Business Angels from the U.S., Europe, Asia, and Africa also participating.

Launched in Morocco in 2020, Freterium has experienced fast growth in 2021 and has opened a new office in the UAE to address neighboring markets in the region. Their product, a new-generation Transport Management Software, connects shippers with their entire logistics ecosystem to collaborate in real-time, helping them cut time and shipping costs. It is aimed at any company that delivers products on a daily basis: manufacturers, distributors, retailers, and logistics providers across industries can manage all of their shipments in just a few clicks on Freterium´s slick and intuitive interface.

Freterium´s co-founders, Mehdi Cherif Alami, CEO, and Omar El Kouhene, CPO, have previously worked in consulting and logistics, helping global and local players with their strategy and operations. “This $4 million funding round is an endorsement of our unique model and approach, our team’s capabilities and the tremendous market opportunity. We are grateful for the support of the finest investors that share our vision and our values. The timing is right to scale our product across the region and beyond. For most companies, logistics challenges have become a boardroom conversation. We are already trusted by leaders in their respective industries, and we look forward to putting our product at the Morocco-based T&L Tech startup currently has 20+ enterprise customers and more than 3,000 users of its software disposal of many small and large players that need us.” says Mehdi Cherif Alami.

With this funding round, Freterium has become one of the most-funded startups in the emerging Moroccan ecosystem. The startup plans to invest its newly acquired funds in its tech and product development to fuel growth and serve more companies in Africa and the Middle East. They are planning to double the size of the team within the next 12 months. “We have been looking closely at the freight trucking market in Africa & the Middle East for the past 5 years, a market worth $250Billion. 85% of the volume is carried through established legacy partnerships between shippers and carriers and still runs with manual, inefficient tools. Freterium has built a holistic approach to solving the key challenges of the industry with a next-generation cloud-based Transport Management Software (TMS) allowing shippers to connect efficiently with their entire logistics ecosystem and collaborate in real time. We are excited to support them in their mission to empower manufacturers, retailers and logistics teams across Africa” commented Cyril Collon, General Partner at Partech.

“The value proposition of Freterium is unique and we are convinced that their product will significantly impact the industry. It’s a Moroccan gem that we are proud to support in its development and growth.” concluded Yassine Haddaoui, Managing Partner at CDG Invest.