Convergence Partners – an investment management firm focused on the telecommunications, media and technology sector in Africa yesterday announced the launch of the Convergence Partners Communications Infrastructure Fund (CPCIF), the only infrastructure fund that is dedicated solely to the information and communications technology (ICT) sector in Africa.
With a first close of $145 million, it is one of the largest African based infrastructure funds, notwithstanding its single sector focus.
CPCIF, which has a targeted final close of $250 million, aims to invest in communications infrastructure and related services and technologies across sub-Saharan Africa, with a clear focus on future investments and development in West Africa.
Convergence Partners further plans to set up a West African office within the next year. The Fund expects to generate significant returns for investors, while also enabling ICT-driven socio-economic development.
CPCIF reached its first close with capital commitments from the following investors: Convergence Partners (as sponsors), the International Finance Corporation (IFC), the European Investment Bank (EIB), the Dutch Development Bank (FMO), the Development Bank of Southern Africa (DBSA) and the CDC Group (CDC).
“As specialist ICT investors and innovators, Convergence Partners is dedicated to accelerating investment capital, digital access and ICT infrastructure development on the continent,” said Andile Ngcaba, chairman of Convergence Partners.
“As a result, we focus strongly on initiatives that increase the availability of communications, broadband services and new technology offerings to African people. The launch of this Fund will enable us to achieve these objectives on a greater scale.”
The African ICT sector has seen significant growth and is a catalyst for economic development.
According to a recent McKinsey report, increased use of the Internet in Africa could result in a contribution of $300 billion a year to the continent’s gross domestic product (GDP) by 2025.
However, the infrastructure to deliver these services remains significantly underdeveloped. The upgrading, management and ownership of existing and new infrastructure by specialist owners with private capital provides the investment opportunity for CPCIF to achieve its financial and developmental goals.
Convergence Partners’ founders are seasoned pan-African private equity players, experienced in developing value-add investments that deliver shareholder returns whilst underpinning continental transformation.
Convergence Partners has invested in various landmark African transactions, which have brought cost effective broadband services to underserved African markets.
The Fund is committed to facilitating regional ICT infrastructure and integration, ultimately fostering the advancement of a sustainable and more prosperous Africa.