…Recognition of the Fund’s 20-year track record mobilising long-term blended finance to deliver transformative infrastructure in sub-Saharan Africa.
…Rating affirms EAIF’s strong capital position, moderate leverage, diversified portfolio, and strong shareholder base.
MON, 22 AUG, 2022-theGBJournal| Private Infrastructure Development Group (PIDG) company, the Emerging Africa Infrastructure Fund (EAIF or The Fund), today announced that Moody’s has assigned EAIF a foreign currency long-term issuer rating of A2 with a stable outlook.
EAIF mobilises public and private debt capital to deliver transformative infrastructure in sub-Saharan Africa. Since its establishment in 2001, up to December 2021, EAIF has closed 90 projects for a total investment of $2.1 billion, and mobilised private sector investment commitments of $15.2 billion.
International Rating Agency Moody’s confirmed that the main factors underpinning the EAIF’s A2 rating are:
-A strong capital position that reflects moderate but rising leverage, and a diversified lending portfolio notwithstanding weak asset credit quality;
-A robust base of liquid assets stemming from highly-rated development finance institutions and commercial lenders;
-A high level of member support from a base of highly-rated shareholders, reflecting EAIF’s strategic position in the broader Private Infrastructure Development Group (PIDG).
The rating affirms EAIF’s leading position as an attractive vehicle for investors seeking exposure to the burgeoning African infrastructure asset class, with strong Health, Safety, Environment and Security (HSES) performance, a proven ability to generate sustainable development impact and significant downside mitigation due to strong anchor support from four European governments.
EAIF’s unique blended finance model is backed by leading development finance institutions and commercial and institutional lenders, with a dual mandate to deliver commercially competitive returns and sustainable impact. The Fund has received US$395m of equity capital from four Governments (United Kingdom, Switzerland, the Netherlands, and Sweden) through the Private Infrastructure Development Group. Retained earnings are over US$100m and have been recycled back into the Fund. The Fund’s loss rate has been low, demonstrating the essentiality and commercially conservative financing structures of the projects it funds.
Martijn Proos, Director at Ninety One, the fund manager of the Emerging Africa Infrastructure Fund, said: “We are proud to initiate a rating with Moody’s, which recognises the Fund’s unique business model, 20-year track record of success and conservatively levered balance sheet. The A2 rating evidences our ability to take on and proactively manage risk to deliver returns and generate sustainable development impact. We are committed to building our diversified portfolio as we ramp up vital funding for strategic projects that boost Africa’s resilience. This rating will assist us to further diversify the types and sources of funding we can access as we build our business in the years to come.”
EAIF’s current committed loan portfolio is US$ 1.15bn and diversification is strong, with projects spread across 17 African countries and 9 infrastructure sectors (digital communications infrastructure, energy generation, transmission and distribution, gas transportation, distribution and storage, bulk storage and logistics facilities, infrastructure for agribusiness and mining, transportation, affordable housing, manufacturing of infrastructure components and equipment, water, sewage and sanitation). An estimated 151.4 million people across Africa are benefitting from EAIF-funded projects.
The Emerging Africa Infrastructure Fund provides a variety of debt products to infrastructure projects promoted mainly by private sector businesses in Africa and parts of the Levant. The Fund helps create the infrastructure framework that is essential to sustained economic stability, business confidence, job creation and poverty reduction.
The Private Infrastructure Development Group (PIDG) is an innovative infrastructure development and finance organisation which encourages and mobilises private investment in pioneering infrastructure in the frontier markets of sub-Saharan Africa and south and south-east Asia to promote economic development and combat poverty. PIDG delivers its ambition in line with its values of opportunity, accountability, safety, integrity and impact.
Ninety One is an independent, active global asset manager listed on the London and Johannesburg stock exchanges. Established in South Africa in 1991, as Investec Asset Management, the firm was a pioneer in emerging markets in Africa. In 2020, almost three decades of organic growth later, the firm de-merged from Investec Group and became Ninety One. Today, Ninety One offers distinctive, active strategies across equities, fixed income, multi-asset and alternative investments to institutions, advisors and individual investors around the world.
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