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AGF Magazine - March 2019 issue

  • We focus on fixed income opportunities in both public and private markets. Read on to find in which fixed income instruments and in which African markets to invest on pp. 10-11. In addition, Ashley Benatar of Ashburton Investments shares his views on benefits and risks of investing in mezzanine debt on p.22.
  • We speak with Jérémie Ceyrac, Head of Equity, Responsible Investments at Proparco to learn more about the French development institution, financial products on offer, recent investments in Africa and African impact investment scene (pp. 13-15).
  • This month’s market feature focuses on Nigeria. Sven Richter, Fund Manager, Drakens Capital, writes about his recent trip to the West African country and his observations. “While Nigeria is attractive as an investment destination, the GDP growth is a disappointment for a county that we expect to be one of the leaders in Africa,” he says (pp. 16-17).
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News > Private Equity > Deals

SunFunder arranges $9m debt financing facility for SolarNow

Africa Global Funds
Jan. 18, 2019, 2:45 p.m.
402

Word count: 379

SunFunder - led consortium has closed a $9m receivables financing facility with Kampala-based off-grid solar company SolarNow.

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SunFunder - led consortium has closed a $9m receivables financing facility with Kampala-based off-grid solar company SolarNow.

Oikocredit and the responsAbility-managed private debt fund have participated with SunFunder to finance the company, after a similar $6m syndication 14 months ago.

Stefan Issler, responsAbility’s Head of Direct Investments, Energy Debt Financing, said: “We were excited to see SolarNow’s successful growth ever since we teamed up with SunFunder to finance the company a little over a year ago and look forward to supporting SolarNow as a long-term financing partner.”

The facility is SolarNow’s third structured asset finance instrument (SAFI) arranged by SunFunder. 

It will enable the company to deploy 17,500 new off-grid solar systems to customers in Uganda, along with a range of appliances.

SunFunder’s Director of Investments Surabhi Visser said: “We have just had our 5-year anniversary working with SolarNow, and this takes us to $19m in investments that we’ve arranged or made directly in the company. We are proud to have backed SolarNow’s growth delivering top quality solar systems and appliances throughout Uganda.”

There are 1.2 billion people in developing countries with no access to electricity, while another billion only have unreliable access. 

Solar power now offers an economic solution for people living off-grid in rural areas, providing lighting, mobile phone charging and even highly-efficient televisions and fridges. 

A new generation of solar companies have emerged to deploy these systems commercially, but many have struggled to access mainstream financing to fuel their growth.

The SAFI is a tailored receivables financing structure designed by SunFunder for solar companies deploying systems through pay-as-you-go and solar leasing models. 

SAFI finances their credit offerings directly, allowing them to reach more customers.

Willem Nolens, SolarNow CEO, said: “This syndication and the SAFI structure allow us to minimize the fundraising burden and to focus on our business instead. By selecting the right clients and treating them well, our credit portfolio remains healthy and we create a strong foundation for sustainable growth.”

The new systems will amount to around 2.5 MW of new installed off-grid solar capacity, resulting in over 210,000 tons of greenhouse gas emissions avoided through displaced kerosene for lighting. 

Among the expected impacts, the company estimates that over 70,000 Ugandan women will gain improved energy access.


 

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