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ARVF II hits first close, exceeds target size

Staff writer
May 18, 2021, 1:24 p.m.
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Ascent has announced the first rolling close of its Ascent Rift Valley Fund II (ARVF II) at more than $100m, significantly exceeding its initial target of $80m.

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Ascent has announced the first rolling close of its Ascent Rift Valley Fund II (ARVF II) at more than $100m, significantly exceeding its initial target of $80m.

The final close of ARVF II, with a target of $120m, is expected in December 2021. 

"We are proud to have raised this additional capital from prominent investors to invest in Africa's most promising companies," said David Owino, Founding Partner of Ascent.

"We are now well positioned to become the leading SME fund manager in East Africa, empowering ambitious entrepreneurs with capital and knowledge from our local advisory teams."

ARVF II will invest equity in leading small and medium-sized enterprises (SMEs) in Eastern Africa, looking to take large minority or majority stakes.

The fund will provide funding to scalable SME businesses, helping to drive wider business and industrial development, particularly targeting the financial services, manufacturing, wholesale and retail trade and services, education, healthcare, and agro-processing sectors.

ARVF II has already made its first investment into financial services in January 2021. 

Investors in ARVF II include BIO, CDC Group, FMO, IFC, Norfund, Proparco, SDG Frontier Fund, impact investors and major Kenyan pension funds.

“We are thrilled that our investment in ARVF II will enhance Ascent’s ability to offer capital to promising SMEs, which significantly contribute to business activities and employment of a large proportion of the working population in East Africa”, Sara Taylor, Head of SME Funds at CDC Group, said.

“With CDC’s investment in ARVF II, we are pleased to be partnered with a GP that has a track record of supporting the growth of SMEs. CDC has built a collaborative partnership with Ascent that spans over six years, and we’re glad to continue to back its growth – helping to usher in increased capital that will bolster sustainable economic growth across the region.”

“IFC’s support for the Ascent Rift Valley Fund II is a vote of confidence in the dynamism of SMEs in East Africa and comes as the region is working to recover from the economic impacts of COVID-19. Supporting entrepreneurship and smaller businesses is a major pillar of IFC’s strategy in Africa because it contributes significantly to job creation and economic growth”, said Amena Arif, IFC Country Manager for East Africa and Malawi.

ARVF II will promote environmental, social and governance best practices in its portfolio companies in order to drive growth and value, create quality jobs, limit environmental impact, increase government tax revenues and further empower local economies.

“I am thrilled to see both existing investors from ARVF I and new investors come together to underwrite our vision of building strong East African companies," added Ascent's Founding Partner Lucas Kranck. "The fact that we were able to mobilise capital for these markets amidst a global pandemic is testament to their enormous potential."

The Charles Russell Speechlys Africa Team has advised Ascent Capital Africa on the establishment and fund raising for its second fund.

The Charles Russell Speechlys Corporate and Financial Services & Funds team was led by Partner Victoria Younghusband, and included Partners Adrian Mayer and Keir Gordon, Associate Edidem Basiekanem and Trainees Zoe Bowler and Giulia Brunello.

Corporate partner, Victoria Younghusband said: “We are very pleased to have assisted Ascent Capital Africa on this process for its second fund, which showcases our team’s work in fund formation, and also complements our transaction advisory experience and expertise, (for funds and corporates), across Africa. Personally, I am delighted for Lucas and David and the rest of the team on the successful conclusion to this stage of ARVF II’s life and wish them all the best in the next stages too.”

Adrian Mayer, Head of the firm’s Africa Team, added: “I have known Lucas for a long time and am so pleased for him and the rest of the Ascent team on this successful fund raise, which was undertaken in unique and challenging circumstances. The first close of this fund comes at good time for our firm too, as we are deepening and refocussing our commitment to the Financial Services & Funds sector, which will supplement our existing expertise and experience with Africa focussed businesses across the firm. We look forward to working further with Ascent in the months ahead.”

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