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1. Frontier Markets Fund
Managers
US$ 944 million committed to 52 projects
Roland Janssens, Director
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2. Frontier Markets Fund Managers- FMFM
 FMFM is the fund manager of
 Emerging Africa Infrastructure Fund (EAIF); and
 GuarantCo
 The fund manager is owned by Standard Bank (70%), FMO (18%) and EMP
(12%)
 The fund management team is based in London
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3. EAIF & GuarantCo are part of the Private Infrastructure Development
Group – PIDG
UK; SWEDEN; NETHERLANDS; SWITZERLAND; GERMANY; AUSTRIA; IRELAND; WBG
PIDG Trust
EAIF GurantCo ICF TAF InfraCo DevCo
EAIF & GuarantCo
Management can finance projects
provides funding
agreement with developed by
along side
EAIF & GurantCo InfraCo & DevCo
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4. Emerging Africa Infrastructure Fund - EAIF
 First dedicated debt fund for sub-Saharan Africa (started in Jan.2002; 10 years old)
 Current Size: US$ 710m
 Shareholders: 4 European Governments (UK, Netherlands, Switzerland and
Sweden) - US$ 160m
 Equity leveraged through a combination of Senior and Subordinated Debt from 7
DFIs (FMO, DBSA, KFW, DEG, IFC, AfDB and OeEB) and 2 commercial banks
(Standard Bank SA and Barclays)
 Approval process takes between 8-12 weeks from the in principle approval to
Board approval
 Operates on commercial basis
 Financed 38 projects to date with a total exposure of US$ 758m
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5. EAIF – investment policy
 Lend to private sector owned, managed and controlled entities with infrastructure
sector focus
 Power
 Transport
 Telecoms
 Water
 Manufacturers of components of infrastructure e.g. cement
 Infrastructure within mining and agribusiness projects
 Sub-Saharan Africa focus excluding Mauritius
 Investment Size:US$10 – US$30 million
 FMFM can arrange US$200 million and more through its financing partners
 Tenor: up to 15 years
 Instruments: Senior and Mezzanine Debt (possibly with equity features)
 Does not require a Political Risk Insurance (PRI)
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6. EAIF’s Portfolio is Spread Over 7 Sectors & 15 Countries
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7. EAIF - selected transactions
Rabai African Foundries Limited - PARCO
 Sector: Power  Sector: Industrial goods
 Country: Kenya  Country: Nigeria
 Description and Financing Parameters:  Description and Financing Parameters:
 EAIF was the lead arranger of Euro85  EAIF committed US$ 20m of senior debt
million facility for the Rabai Power Project to African Foundries Limited, Nigeria
in Kenya, developed by Aldwych  The Debt package comprised of: (i) a 7¼-
International together with BWSC year DFI tranche, (ii) a 3 year Comercial
 Debt package comprised of a Senior and Banks tranche and a working capital
Subordinated Debt. facility form Nigeria banks
 Lender Group included, FMO, Proparco,  The plant would be the only Nigerian
DEG and EAIF facility with the capability to produce
 The project received Africa power deal of TMT rebars
the year awards from Project Finance
International and Project Finance
magazine
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8. EAIF - selected transactions (continued)
Seacom MOMA
 Sector: Telecom  Sector: Mining
 Country: Pan African  Country: Mozambique
 Description and Financing Parameters:  Description and Financing Parameters:
 The US$600m Seacom project is the  The developers of this titanium
first undersea fiber optic cable project mineral sands project approached
along the east coast of Africa, the EAIF as a „lender of last resort‟.
only region in the world not currently
 Located in one of the most under-
served by such an infrastructure
developed regions of Mozambique,
 EAIF provided US$36.5m debt the US$413 million project is the
financing to a special purpose vehicle second lowest cost producer of
controlled by Industrial Promotion titanium in the world
Services (Kenya), one of the sponsors
and a subsidiary of the Aga Khan  EAIF committed US$36.5 million of
Fund for Economic Development senior and subordinate debt (total
debt package of US$270 million)
 The project received deal of the year
award from Project Finance  The project received deal of the year
International awards from both the Mining Journal
and Project Finance International
publications
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9. Pipeline: 26 additional NBC approve projects US$488 m
exposure
Sector Number Amount
of Projects US$ m
Agribusiness 4 72.5
Power 8 161.2
Telecoms 3 32.1
Transport 2 47.5
Water 1 28.3
Waste 1 20.0
Gas 2 21.0
Manufacturing 3 60.0
Mining 2 45.0
Total 26 487.6
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10. Projects financed or in the process of financing by EAIF
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11. EAIF Summary of transactions (2003-2008)
Jan 2003 Aug 2003 Oct 2004 Nov 2004 Nov 2004
MSI-Cellular / Celtel AES Sonel MOMA MTN Nigeria SPM Ghana
US$ 260 million EUR 240 million GBP 594 million US$ 200 million US$ 47.3 million
Expansion of a GSM network across Construction of an 85 MW HFO fired power Construction and operation of a Greenfield Corporate facility for the expansion of MTN’s Financing of a Single Point Mooring system
selected countries in Arica plant in Cameroon; in 2006 the facility was mineral sands project (ilmenite, rutile, zircon) GSM network in Nigeria and a conventional buoy mooring system in
increased to EUR 240 million and EAIF near Moma, northern Mozambique the waters outside Tema Port, Ghana
acted as a co-lender
US$ 30m EUR 24m US$ 5m - Senior Debt US$ 10m US$ 12m
Mezzanine debt facility Arranger –Senior Debt Facility US$ 24.5m - Mezz. Facility Senior Debt Facility Senior Debt Facility
September 2005 Feb 2007 February 2007 June 2007 Nov 2007
Obajana Cement Eleme Petrochemicals Celtel Nigeria Celtel Africa Seacom
US$ 798 million US$ 400 million US$ 190 million US$ 320 million US$ 600 million
Construction and commissioning of a Financing of a post privatisation turnaround Corporate facility for the expansion of Corporate facility for expansion of GSM Debt financing for equity participation of IPS
greenfield cement production plant with a program for a petrochemical plant in Nigeria Celltels GSM network in Nigeria network in 5 African countries Kenya (AKFED) in Seacom, the first submarine
capacity of 4.4 million tons per annum in fibre optics cable along the eastern coast of Africa
Nigeria
US$ 30m US$ 20m US$ 35m US$ 24m US$ 36.5m lender to IPS CSH
Senior Debt Facility Senior Debt facility Senior Debt Facility Senior Debt Facility for Seacom equity
Jan 2008 Mar 2008 May 2008 Sept 2008 September 2008
Orpower 4 Safal Investments Tronder Power Rabai Power Project SAEMS
US$ 180 million US$ 211 million US$ 56 million EUR 120 million US$ 85 million
Expansion of the Olkaria III Geothermal Construction of a 13 MW run of river hydro Construction of a 13 MW run of river hydro Construction of a 90 MW HFO fired power Corporate facility for a portfolio of 12 small
power project to 48 MW power plant in Uganda power plant in Uganda plant in Kenya hydro power plants in Sri Lanka and Uganda
US$ 15m US$ 15m - Senior Debt US$ 35m Senior Debt EUR 22.5m US$ 14m
Senior Debt Facility US$ 14m - Sub Debt Underwriter and Arranger Arranger –Senior Debt Facility Senior Debt Facility
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12. EAIF Summary of transactions (2009-2011)
Jan 2009 February 2009 June 2009 October 2009 December 2009
SPA Maghreb Aldwych International Zain Ghana Bisha Mining Share Company Helios Towers Nigeria
US$ 24 million GBP 44 million US$ 523 million US$ 460 million US$ 250 million
Construction of green field steel pipe Round B equity and high yield debt financing Construction and operation of a greenfield Construction and operation of the first Corporate facility for the expansion of Helios’
manufacturing company in Algeria for start up power plant developer Aldwych mobile network in Ghana modern mine in Eritrea mining gold and tower network in Nigeria
International copper in Eritrea
US$ 17m EUR 6m - Senior debt US$ 17.5m US$ 25m US$ 19m
Senior Debt Facility US$$ 1m - Equity Senior Debt Facility – B Loan Mezzanine debt Senior Debt Facility
December 2009 July 2010 October 2010 November 2010 November 2010
African Foundries
Limited
African Foundries Limited ALAF Limited Tema Osonor Power Ltd DPW Dakar O3b Networks
US$ 130 million US$ 35 million US$ 128 million EUR 216 million US$ 1.2 billion
Construction of a 150MT p/a rolling mill that Construction of a Metal Coating and Roofing Construction of a 126MW gas
-fired power Upgrade & expansion of the container Orbit Satellites and ground facilities to
will produce TMT Rebars, Nigeria facility in Tanzania plant in Tema, Ghana terminal in the Port of Dakar, Senegal deliver fibre quality broad band
communications services to emerging
markets
US$ 20m US$ 5m US$ 15m EUR 12.5m US$ 12.5m Senior Debt
Senior Debt Facility Senior Debt Facility Co-Arranger –Senior Debt Facility Senior Debt Facility US$ 12.5m Sub Debt
June 2011 June 2011 August 2011 December 2011 December 2011
Tower Power Abeokuta Ltd Addax Bioenergy KivuWatt Ltd Helios Towers Tanzania Kalangala Infrastructure
US$ 21.3 million EUR 267 million US$ 140 million US$ 85 million US$ 54 million
Constriction of Greenfield 12.5MW gas fired The development of a 10,000ha sugarcane The development of an Integrated Methane Acquisition of >1000 telecom towers from Development of road, ferry, water supply and
combined cycle power plant in Nigeria plantation, an ethanol distillery producing Gas to Power Project in Rwanda utilizing Millicom Tanzania Ltd. Debt facility for power services for Kalangala District in
82,000 m3 of ethanol p.a. and a 32MW Lake Kivu’s unique methane gas resources. refurbisment and expansion of the tower Uganda
cogeneration power plant in Sierra Leone The project will consist of a Gas Extraction network
Facility plus a 25MW power plant
US$ 15m EUR 20m US$ 25m US$ 15m US$ 7m
Arranger –Senior Debt Facility Co-Arranger –Senior Debt Facility Co-Arranger –Senior Debt Facility Senior Debt Facility Senior Debt Facility
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13. EAIF Summary of transactions (2012-)
January 2012
SAEMS II
US$ 30 million
Increase of the corporate facility to facilitate
the development of SAEMS’s 2 hydro
nd
power project in Uganda
US$ 6m
Senior Debt Facility
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14. GuarantCo
GuarantCo‟s business is:
“Credit enhancement of local currency debt issuance by the private, municipal and
parastatal infrastructure sectors in lower income countries”
In addition to enabling infrastructure this approach also builds sustainable financing
capacity in domestic capital markets through partnering with local institutions and
introducing new approaches to project risk evaluation and financing
 Initial capital of US$100m leveraged to US$200m by KFW and Barclays
 Additional backing from KfW / Barclays up to total of US$400m
 Covers similar infrastructure sectors to EAIF plus urban infrastructure
 Can include refinancing to local currency
 Operates globally
 Financed 14 projects to date with a total exposure of US$ 185.5m
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15. GuarantCo offers
 Partial credit guarantee covering default risk on a portion of a loan or bond -
generally on demand and unconditional
 Partial risk guarantee covering default risk due to specific events - such
construction failure or revenue shortfall
 Cover for senior, mezzanine or sub debt; maturity, coupon or principal strips;
Loans, bonds or securitisation
 Other methods of risk transference considered (e.g. insurance / reinsurance or
CDS / derivatives)
 Preference for risk sharing - defined on a case-by-case basis
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16. Case Study – Tower Aluminium Limited
 Tower Aluminium Group Limited (“Tower”), the largest manufacturer of aluminium roofing
in West Africa
 In late 2008 the Naira devalued by c 25% against the USD. Tower‟s revenues are mostly in
Naira and the impact of the devaluation was to significantly increase the cost of servicing its
USD financial liabilities.
 Tower decided to refinance its USD liabilities by issuing a 7 year Naira denominated
corporate bond.
 Tower was however unable to secure the “A” local rating required to be able to access local
pension funds. GuarantCo was able to use its local AAA rating in Nigeria to credit enhance
Tower‟s bond issue.
 This was the first time such a structure had been used in Nigeria.
 GuarantCo‟s support also stretched the tenor to 7 years from the typical 5 years for previous
corporate bonds.
 Following a request for assistance, GuarantCo is also working with the Nigerian Securities &
Exchange Commission to set up training and mentoring of their staff.
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17. GuarantCo - Summary of transactions (2005-2009)
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18. GuarantCo - Summary of transactions (2010-2011)
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19. Potential Transactions
 Up to $15m partial guarantee for an integrated wood fuel manufacturing and power
generation project in Liberia
 Guarantee of Thai Baht financing for biogas projects in Mekong region
 Partial guarantee of $7m finance for a new private sector utility on Bugala Island,
Uganda
 $17m partial guarantee for a new factory producing steel pipes for the water sector
in Algeria
 Partial guarantee of a $22m broadband backbone service financing in Niger
 $20m partial guarantee for a 128km gas pipeline in Nigeria
 Credit enhancement of a $13m programme for financing sub-national providers of
water and waste water services in Kenya
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20. Through PIDG we can provide grant funding to new projects
The grant funding supports the following activities
 Infrastructure Development Strategies:
 Studies intended to support go/no decision for new projects
 Environmental Studies:
 Studies intended to support the Project‟s environmental aspects
 Pioneering or Pilot Transactions:
 Support to the design and implementation of particular projects or transactions such as feasibility
studies
 Capacity Building:
 Activities aimed at policy development and initial legal work
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21. Contact details
Roland Janssens
Director
Frontier Markets Fund Managers (FMFM)
Add: 20 Gresham Street, London, EC2V 7JE
Tel: +44 203 145 8611
Mob: +44 7825 504 290
Mail: roland.janssens@frontiermarketsfm.com
www.frontiermarketsfm.com www.emergingafricafund.com www.guarantco.com
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