Catalyst Fund II raises US $ 155 million in East Africa investment



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NAIROBI, KENYA, 9. FIGHT – Central Africa's Fund Manager, Catalyst Principal Partners, announced the closure of its other funds and reached $ 155 million.

It is about $ 15.5 billion worth of private equity investments that will lead international and regional investors as a successor to Catalyst Fund I, a $ 125 million fund in 2009.

With the launch of its second fund, Catalyst ignites its position as the leading regional venture capital fund manager with the largest number of funds managed by its owners in the East African region.

More than 80% of international institutional investors invested in catalyst II who have already been investors in their first fund, Catalyst increased its investment commitments by more than 30% of its existing investors and attracted capital from new international and regional investors, including local pension funds and family offices.

According to Paul Kavuma, CEO of Catalyst, the increased investment by international institutional investors is a sign of confidence in the economic potential of the East African region.

The UN Conference on Trade and Development (UNCTAD) shows that the East Africa region was 18% of Africa's foreign direct investment in 2017.

"Since Catalyst Principal Partners is the leading East African-focused fund investing only in the region, the interest of international institutional investors demonstrates that trust in the regions is a strong foundation, with the East Africa region being the fastest-growing region of the continent, still attracting investors, Kavuma said.

Commitments by regional investors, up 50% of catalyst II, the emergence and mobilization of local capital at the start of the regional venture capital industry.

The East African Community and Regional Development Agency Secretary General Adan Mohamed, who officially led to the closure of Catalyst Fund II, noted that the regional Private Equity sector has been growing steadily over the years and more companies are interested in the development of regional economies.

"It is also noteworthy that regional investors, including pension funds, account for nearly 20% of Catalyst Fund II's commitments, which is a clear indicator that the region can not only receive funds and guarantee the return on investment and also raise funds for its own development, CS. Adan added.

He said that the Government of Kenya will continue to pursue reforms aimed at improving the local business environment and striving to conclude trade agreements and companies that expand the market for local businesses.

This includes the South Africa Free Trade Area (CFTA) agreement, which was signed earlier this year in 44 countries, creating more than 1.2 billion people in a broader market with a total gross domestic product of US $ 2.19 trillion.

"The creation of this market allows the continent to deepen intra-African trade while at the same time generating growth opportunities for medium-sized companies, such as catalyst-like PE funds, is a key factor for SMEs to take advantage of these markets, in addition to the reforms in the local infrastructure and part of the East African Community, such as the North Corridor project, which makes it easier for businesses to join, "he said.

Catalytic Director Kavuma stated that the region's interest is largely due to policy reform, investment in infrastructure, regional integration and harmonization.

"Catalyst focuses mainly on emerging and medium-sized enterprises with strong growth and profitability prospects, attracting both international and regional investors in private equity classes, demonstrates that East Africa is not only an attractive place to invest but also that private capital offers a credible and innovative financing solution for ambitious companies and entrepreneurs looking for tailor-made venture capital to support growth and improve performance, "added Kavuma.

In 2009, the sum of $ 125 million ($ 12.5 billion) of the Catalyst Fund was invested in 9 companies in Kenya, Tanzania and Ethiopia with various interests in consumer goods, pharmaceuticals, industrial agricultural processing, logistics and technology and healthcare production, technology and financial services .

Catalyst Fund II invests about $ 7.5 million to $ 22.5 million in emerging mid-level operators in East Africa, which play a key role in the growth sector that meets the demands of increasingly desirable consumers based on favorable regional criteria.

The Fund will focus on Kenya, Uganda, Tanzania, Ethiopia, Zambia, Rwanda and the Democratic Republic of Congo.

Catalyst Principal Partners invests in a four-to-six-year investment horizon by taking a significant shareholding focus on expansion and replacement capital requirements, recapitalization and pre-IPO investments.

Through Catalyst Group II, Catalyst Principal Partners seeks to increase the footprint and impact of private equity funds across the region, enabling more companies to access innovative financing solutions by providing capital-intensive value-added for the development of leading regional scales.

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