Bush announces new Africa Opic funds

Last Updated February 21, 2008

The US Overseas Private Investment Corporation (Opic) has launched five new private equity investment funds, with a combined target capitalisation of US$875mn, aimed at a variety of sectors such as healthcare, housing, telecommunications and small and medium-sized enterprises (SMEs).

The funds were announced by President George Bush during his recent trip to Benin, Tanzania, Rwanda, Ghana and Liberia.

In his announcement Bush said: "The new era is rooted in a powerful truth: Africa's most valuable resource is not its oil, it's not its diamonds, it is the talent and creativity of its people. So we are partnering with African leaders to empower their people to lift up their nations and write a new chapter in their history.”

He added that the best way to generate economic growth in Africa is to boost its trade and investment. The new funds follow the launch last year of Opic’s Africa financial sector initiative where Opic set up a US$750mn investment capital fund for African businesses.

The funds comprise an Africa Health Care Fund with a target capitalisation of US$100mn; a Capital Alliance property investment company with a target of US$200mn focusing on supporting housing projects; and a Africa Telecoms Media and Technology Fund with a target capitalisation of US$100mn to invest in technology, media and communications companies, mainly in Kenya and Tanzania.

The final two funds include an Africa Debt Fund which will have a target amount of US$300mn to invest in public and private debt instruments in Africa. This fund will invest in a mixture of African government and corporate debt securities, issued in both local and external currencies.

It will focus on privately-negotiated debt transactions with private enterprises, and will also be able to invest up to 30% of its capital in secondary market purchases.
The final fund, AfricInvest II has a target capitalisation of US$175mn to invest in small and medium-sized companies with a particular focus on those in Morocco, Algeria, Tunisia, French West Africa, Nigeria, Ghana and Kenya.