The Board of the African Development Bank has approved a €12.5 million equity investment in Adiwale Fund 1, a first-generation private equity fund targeted at high growth potential Small and Medium Sized Enterprises (SMEs) in Francophone West Africa.
The fund, targeted to be €75 million, will take minority stakes in SMEs that are well established in their market, have a competitive advantage and can rapidly scale up. Average deal size for the Fund will range from €3 to €8 million. The primary countries to participate include Cote d’Ivoire, Senegal, Burkina Faso, and Mali while the secondary countries will include Togo, Benin, and Guinea. These countries are currently underserved by the global Private Equity (PE) market.
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The fund will cover consumers (comprising consumer goods and services, education and health); business services (transport, logistics, IT, internet services, construction-related services) and manufacturing (pharmaceuticals, agri-processing, chemicals, etc.).
“The Bank’s investment in Adiwale Fund 1 would enhance the availability of financing and capacity support for SMEs in Francophone West Africa,” said Alhassane Haidara, Divisional Manager of Non-Sovereign Industries and Services at the African Development Bank.
Established in 2016, Adiwale Partners houses a team of experienced West African nationals with several decades of combined private equity, operational, development finance and asset management experience in Africa, Europe, and the United States.
With support from the Bank, the team is expected to drive value creation in investee companies through improvements in internal functions and implementation of best-governance practices. This investment will provide growth capital to African SMEs, resulting in spillover effects on job creation and tax revenues.
It will support local entrepreneurs with access to business management expertise and promote regional integration for companies looking to expand regionally. It will also boost corporate governance and human capital development to support economic transformation.
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