Nigerian firm to manage Germany’s African fund

In from Success Allantee…

United Capital Plc, a Nigerian investment banking group quoted on the Nigerian Stock Exchange (NSE), and Lion’s Head, have been appointed as the fund managers for the Africa Local Currency Bond Fund (ALCB Fund) set up by the German government.

ALCB Fund was established by KfW on behalf of the German Federal Ministry for Economic Cooperation and Development. On behalf of the German Federal Ministry for Economic Cooperation and Development, KfW has so far invested $32 million for the initial capitalization of the Fund, out of which $18.4 million has been invested in seven non-sovereign local currency bond issuances.

The ALCB Fund’s mission is to support local African banks, financial institutions, agribusiness, and renewable energy companies to issue bonds and similar instruments in local currency. The Fund aims to improve and diversify access to long term funding in domestic capital markets for the benefit of Micro, Small and Medium-sized Enterprises (MSMEs)

United Capital will be represented by its asset management arm, United Capital Asset Management. Lion’s Head, a merchant bank based in London and Nairobi brings capital markets expertise to development finance initiatives for frontier markets. Lion’s Head advises across a broad range of capital markets and corporate finance initiatives across Africa, working with both the public and the private sector.

As fund managers, United Capital and Lion’s Head will be expected to implement an institutional upgrade and grow the Fund to a size beyond $100 million in the medium term.

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“The ALCB Fund is the latest innovative vehicle to have been established by the group, following similar initiatives in microfinance, agri-finance, interbank lending and foreign exchange hedging

“We are excited to add the ALCB Fund to our asset management platform. It exemplifies our commitment to bringing about change through the use of targeted, financially viable investment strategies”, said Bim Hundal, Chairman of Lions’ Head.

Deputy Group Chief Executive Officer and Managing Director, Investment Banking at United Capital, Wale Shonibare said the company would bring its African market expertise to bear in providing the necessary tailored solutions to significantly grow the Fund, and to meet KfW’s development objectives.

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