AFRICA – AgDevCo, a specialist investor in early-stage African agribusinesses, has raised US$90-million from British, US and Norwegian funds to shore up investments that will help small farmers raise yields and reduce waste.
Britain’s development finance institution, CDC Group and Norwegian investment fund for developing countries provided US$50-million and US$20-million as equity respectively while US International Development Finance Corporation issued US$20-million in debt.
This is in addition to the supplementary funding of up to US$5.4m from CDC, Norfund and the UK’s Foreign, Commonwealth and Development Office (FCDO) for AgDevCo’s integrated technical assistance facility.
“Securing investment from CDC, Norfund and DFC is a major milestone in AgDevCo’s history. It is a strong endorsement of AgDevCo’s team and our strategy. We are excited that our vision is shared by our new funders, who recognise the important contribution that AgDevCo investments can make to productivity, sustainability, and inclusivity in Africa.
“Their funding marks the beginning of a partnership in which AgDevCo will use its sector specialism, drawing on our new funders’ networks and resources, to increase the number of impactful investments in African agriculture,” said Keith Palmer, AgDevCo’s founder and Chairman.
Established in 2009, AgDevCo’s vision is a thriving commercial African agriculture sector that benefits people, economies, and the environment.
The organisation contributes to this goal by providing investment capital and technical assistance to grow sustainable and impactful businesses across the agricultural value chain.
In doing so, it aims to promote resilience, gender equality and the production of better-quality, more nutritious food.
Tenbite Ermias, CDC’s Managing Director for Africa, said, “This investment reinforces our long-term commitment to investing in key sectors in Africa including agriculture, which is critical for creating jobs, promoting gender equality and supporting people to build a better life for themselves and their families.
“Furthermore, it reflects our continued focus on climate finance which is central to our new strategy over the next five-year period, to support emerging economies that are most vulnerable to the impacts of the climate emergency.”
This new funding builds on the original endowment funding provided by the UK government which helped establish AgDevCo over the past decade.
This endowment has provided capital to agribusinesses that have directly created or sustained more than 15,000 jobs and to work with 750,000 smallholder farmers to help increase their income and improve their resilience to climate change.
It has also allowed AgDevCo to build a capability and track record to the point where it can secure external investment capital.
UK Minister for Africa, Vicky Ford, said: “I am proud to see how AgDevCo’s investing has boosted sustainable agriculture across Sub-Saharan Africa over the past 10 years, including deepening impact on smallholder farmers and SMEs. This new investment will bring continued growth, by enabling agribusiness SMEs to expand, improve farmer incomes, create new jobs and strengthen climate resilience across Africa.
Ellen Cathrine Rasmussen, Executive Vice President of Scalable Enterprises in Norfund and Algene Sajery, DFC’s Vice President of External Affairs and Head of Global Gender Equity Initiatives noted that the investment will enable AgDevCo to link more farmers to markets and create jobs for underserved populations, with a focus on women farmers.
AgDevCo’s investments typically range between US$ 2 million and US$ 10 million, focusing on a variety of sectors and crops, including high-value export crops like avocados and macadamias; nutritious food industries for domestic markets and affordable meat protein like poultry and fisheries.
Portfolio companies are involved throughout the food sector from primary production, through processing to retail.
In addition to provision of capital, AgDevCo helps its investees grow into profitable businesses by providing specialist technical support and access to technical assistance funds.
So far it has invested in 80 agribusiness across sub-Saharan Africa with its current investment portfolio comprising of over 40 companies with a total value of US$150m.
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