AFC secures €50 million credit line

The Africa Finance Corporation (AFC) has secured a €50 million credit line provided by the Society for the Promotion and Participation for Economic Cooperation (PROPARCO) with the participation of European Financing Partners South Africa (EFP).

The EFP tranche totalling €25 million will be drawn in US dollars and will be utilised to fund Nigeria and Anglophone Africa-based projects, while the PROPARCO €25 million tranche and drawn in euros, will support euro-denominated investments with a focus on Francophone African countries.

The announcement follows AFC’s recent agreement to secure a US$60million joint facility from the German Investment and Development Corporation (DEG) and Netherlands Development Finance Company (FMO).

These facilities form part of an on-going expansion of the AFC’s capacity to lend to value added infrastructure projects across the continent. AFC, a multilateral finance institution, was established in 2007 with an initial capital base of US$1billion, to be a catalyst for private sector infrastructure investment across Africa.

AFC was established to help fill a critical void in providing project structuring expertise and risk capital to address Africa’s infrastructure development needs, and is increasingly being seen as the benchmark institution for private sector-led investment in the core infrastructure sectors of power, natural resources, heavy industry, transport and telecommunications.

Andrew Alli, President and Chief Executive Officer (CEO), AFC, commenting on the lending facility said: “This facility is an important milestone for AFC and further enhances our ability to on-lend to infrastructure projects in Africa across diverse geographies and in a variety of currencies.

“The completion of this facility is a strong endorsement of our approach to investment on the continent by leading multilateral financial institutions. We are also very pleased to deepen our relationship with PROPARCO and the wider AFD group as we jointly seek to expand our investment footprints across Africa, especially within the Francophone African countries.”

Marie-Hélène Loison, Deputy CEO of PROPARCO also said: “We are very pleased to be partnering with AFC. “Following the successful completion of our due diligence process in November 2012, we went a step further to convert our initial discussion of bilateral funding into a club deal by bringing in members of the European Financing Partners (EFP) into the transaction.

This partnership highlights PROPARCO’s strategy to finance investments that are economically viable, socially equitable, environmentally sustainable and financially profitable, and we are delighted to be a partner with AFC.” AFC is an African-led international financial institution, established in 2007 whose mission is to improve African economies by proactively developing and financing infrastructure, industrial and financial assets.

AFC is involved as an investor, developer and financier of various infrastructure projects, and is gaining recognition as the benchmark institution for financing the development of infrastructure projects in Africa. AFC’s current authorised share capital is US$2.0billion with shareholders’ funds of US$1.2436billion and a 2013 funding programme of US$700million.

To complement its shareholders funds and enhance its financing capacity, AFC has completed several other bilateral borrowings from other DFIs and international commercial banks -- including a landmark US$200million funding facility from the African Development Bank.