TOP
Wednesday,August 05,2020 15:39 PM

SMEs to benefit from sh255b fund

By Vision Reporter

Added 22nd August 2009 03:00 AM

THE small-and-medium enterprises (SMEs) are among the businesses that will benefit from $170m (about sh255b) that has been raised by the GroFin Africa Fund (GAF).

THE small-and-medium enterprises (SMEs) are among the businesses that will benefit from $170m (about sh255b) that has been raised by the GroFin Africa Fund (GAF).

By Sylvia Juuko

THE small-and-medium enterprises (SMEs) are among the businesses that will benefit from $170m (about sh255b) that has been raised by the GroFin Africa Fund (GAF).

GAF raised $170m at its final fund closing against a targeted $150m, highlighting increased appetite for investors in emerging markets like Africa.
The fund was created by GroFin, a leading growth finance fund management company, specialising in risk capital and business support for SMEs in emerging markets.

“The GroFin Africa Fund presents additional opportunity in our quest to provide the much-needed finance to SMEs in Uganda who have difficulties in accessing funds to finance their business growth on account of limited collateral, capital, track record or borrowing history,” Walter Ogwal, the Grofin Uganda general manager said, explained in a statement.

“This fund presents new, real and ready opportunities to enable SMEs grow their businesses.

“GroFin Uganda is delighted to be part of this development to meet the unique needs of SMEs and enable them contribute significantly to the creation of sustainable wealth, employment and economic development,” he added.
GroFin announced that the fund would be invested in over 500 companies over a period of five years, making it the largest growth finance fund to date globally.

It has already invested in Uganda, Nigeria, Ghana, Rwanda, Kenya, Tanzania and South Africa through GroFin’s in-country investment teams.
To date, the fund has committed $17m to 50 transactions and is considering investing into a further 24 companies to the value of $8m.

GAF invests between $100,000 and $1m in SMEs operating in various sectors, ranging from manufacturing to services.

Jurie Willemse, the GroFin managing director, said the amount raised was a clear demonstration of the high levels of interest that investors have for smaller investments in Africa.

“The confidence shown in the GroFin team and our unique business model, that integrates risk finance with business development assistance to mitigate the investment risk, is heartening,” he said.

GroFin said following a first close of $140m in the fourth quarter of 2008, recent commitments by the European Investment Bank and PROPARCO (AFD Group), through the Investment and Support Fund for Businesses in Africa, brought about the final close of $170m.

These institutions join African Development Bank, CDC, International Finance Corporation, FMO, Norfund, Shell Foundation and GroFin Investment Holdings as investors to the fund.

GroFin noted that SMEs often struggle to grow because of a lack of access to capital and business development assistance.

SMEs to benefit from sh255b fund

Related articles

More From The Author

More From The Author