CDC, the UK government-owned development finance institution, has provided $32.5 million of financing of a $65 million finance facility to the founders of an African agribusiness, called Export Trading Group (ETG), it said in a statement.
The financing is part of the recently announced $210 million equity raised by ETG, from The Carlyle Group, Standard Chartered and the South Africa-based Pembani Remgro Infrastructure Fund. The CDC quasi-equity loan facility, which includes equity and different forms of debt, was arranged by the Standard Bank of South Africa, the firm said.
It is the first investment CDC has made since its strategy change in September. Previously, the firm operated mainly as a fund of funds investor, but CDC will now also make direct investments as well as providing debt to businesses in Africa and South Asia.
“We chose ETG because it combines strong development impact – touching the lives of thousands of small holder farmers across sub-Saharan Africa – with a compelling investment case. ETG is poised for strong growth, having begun to achieve scale after 30 years of hard work and investment by ETG’s founders,” Mark Pay, a managing director for direct Investments at CDC, said in a statement.