African Development Bank invests $100m to Agvance Africa PE fund of funds

The African Development Bank (www.afdb.org) has approved an equity investment of US$100 million to Agvance Africa, which the bank claims in a press release is the first fund of funds focused on African agribusiness. Agvance Africa’s strategic objective is to increase private equity and other investment flows into the agribusiness sector to address growing food security concerns and unleash the largely unexploited potential of African agriculture and agribusiness sectors.
Agvance will be managed by Credit Suisse Customized Fund Investment Group (CFIG) and will target total capital commitments of US$500m.
It expects to invest in 12 to 15 best-in-class private-equity funds targeting portfolio companies along the agribusiness value chain and across the continent. Agvance Africa will catalyze investment into the agribusiness sector, channeling capital to labour-intensive activities, leading to inclusive job creation and promoting innovative, environmentally sustainable approaches to agribusiness.
AfDB has also played a key role in developing the Agvance concept, with support from the Fund for Private Sector Assistance (FAPA), and will work closely with the CFIG to design a state-of-the-art environmental and social management system, in cooperation with the World Wildlife Fund (WWF). According to the press release, Agvance will work closely with partner development finance institutions (DFIs) and will aim to generate “a multiplier effect on resources available for the development of the agriculture and agribusiness sectors”.
Agvance Africa is in line with AfDB’s strategy to support private sector development on the continent, which has included private equity and venture capital investments. AfDB’s public sector window is cooperating with the UN Food and Agriculture Organization (FAO) and the UN Industrial Development Organization (UNIDO) in the context of African Agribusiness and Agro-industries Development Initiative (3ADI).
Founded in 1999, CFIG currently has one of the largest dedicated alternative investment teams in the world and is uniquely qualified to manage Agvance Africa, given its substantial assets under management, dedicated team and demonstrated private equity investment expertise.
Speaking from the G8 Summit in Camp David, which pledged action to promote sustainable agriculture, AfDB President Donald Kaberuka said: “There was broad consensus that it is the right thing to do, it is doable and it’s good for the world. The summit was about growth, and growth in Africa begins with agriculture.”
Mouhamadou Niang, Manager at AfDB’s Private Sector Department, said in a press release: “This initiative has the potential to catalyze unprecedented levels of investments into the agribusiness sector throughout the African continent. The potential will of course only materialize through efficient and responsive implementation. I have no doubt that with the combined experience of the international fund manager, its local African banking partner, the World Wildlife Fund (WWF)as environmental advisor, and AfDB’s oversight as sponsor, this transformative goal will be achieved in the medium term,”
AfDB’s board of directors approved the anchor investment on 16 May in Tunis.

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