MICROCAPITAL BRIEF: Ascent Rift Valley Fund II Raises $100m from Public, Private Investors for SMEs in East Africa

Kenya-based private equity firm Ascent Capital Africa recently secured USD 100 million at the first rolling close of its Ascent Rift Valley Fund II (ARVF II), surpassing the firm’s initial goal of USD 80 million. The funds will be invested in small and medium-sized enterprises (SMEs) in East Africa, targeting the “financial services, manufacturing, wholesale and retail trade and services, education, healthcare, and agro-processing sectors.” Ascent Capital is seeking to wield these investments to “drive growth and value, create quality jobs, limit environmental impact, increase government tax revenues and further empower local economies.”

The investors include the World Bank Group’s International Finance Corporation (IFC); unspecified “impact investors and major Kenyan pension funds;” and development finance institutions of the governments of Belgium, France, the Netherlands and the UK.

Tibor Asboth, Deputy Head of Equity for Africa and the Middle East at France’s Proparco, said, “Thanks to its decentralized organization (with local offices in Kenya, Ethiopia and Uganda), the Ascent team has demonstrated its ability to support local entrepreneurs in expanding their business while concurrently fostering the implementation of high ESG [environmental, social and governance] standards.”

Ascent Capital was founded in 2012 and established its first fund, ARVF I, in 2014. Placements from ARVF I ranged from USD 2 million to USD 15 million, serving companies in Ethiopia, Uganda and Kenya. Ascent Capital is targeting a final close of ARVF II in December 2021 with a total volume of USD 120 million. The firm plans to invest from this fund in amounts of USD 4 million to USD 15 million, reaching SMEs in Ethiopia, Kenya, Rwanda, Tanzania and Uganda.

By Bradley Shulman, Research Associate

Sources and Additional Resources

CDC Group press release
https://www.cdcgroup.com/en/news-insight/news/cdc-invests-in-the-first-close-of-ascent-rift-valley-fund-ii/

Ascent Capital homepage
https://ascent-africa.com/

Belgian Investment Company for Developing Countries homepage
https://www.bio-invest.be/

IFC homepage
https://www.ifc.org/

Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden homepage
https://www.fmo.nl/

Proparco homepage
https://www.proparco.fr/

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