AfDB approves 10m Euro investment in private equity fund

 In news

The Board of Directors of the African Development Bank has approved a 10 million Euro equity investment in the African compartment of the Moringa Private Equity Fund.

Moringa will invest in scalable, replicable agro forestry projects in sub-Saharan Africa and Latin America. The fund will invest in projects that combine plantation forestry (producing biomass, fuel wood or timber) with agricultural elements (producing staple food crops for local markets and/or niche export crops) to capture most of the value chain. It   will also be associated with a grant-based Technical Assistance Facility.

Sponsored by La Compagnie Benjamin de Rothschild (CBR) and ONF International (ONFI), the international subsidiary of the French Office National des Forêts, the Fund will benefit from CBR back-office and investment platform, while ONFI contributes agro forestry technical expertise and regional presence in the Fund’s targeted geographies.

The Moringa investment strategy is well aligned with the AfDB’s 10-Year Strategy (2013 to 2022), focusing on inclusive green growth as the pathway to sustainable development and creating broad-based prosperity, as well as the Bank’s Climate Change Action Plan, which aims to make investments to reduce the continent’s vulnerability to climate change.
This strategic feat should allow the bank to provide a significant boost to Moringa’s operations via its high public profile, sector expertise and network across the African continent.

Agro forestry generates a strong and diversified platform for the development of forestry sector businesses, whilst also paying attention to the need for agricultural production. Smallholders benefit from an income diversification supported by an investor with a long time horizon.

The Fund will drive better land management, higher and more sustainable income for local populations, and a positive environmental impact on carbon storage, soil/water management and biodiversity. By investing in sustainable agro forestry solutions, the Fund will assist Governments in meeting their adaptation and mitigation targets.

The AfDBwill provide an equity investment of up to 10 million Euro to an African-based vehicle, which has been established for investments located in sub-Saharan Africa.

The bank’s investment brings total commitments to Moringa to almost 70 million Euro and, as the first investor from the African continent in the fund, provides further validation of the fund’s African strategy and prospects as the fund enters the final fundraising phase. Source: The Nation

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