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TLG Capital targets $150m for new credit fund

Anna Lyudvig
Dec. 1, 2015, midnight
604

Word count: 362

TLG Capital, a private equity firm focused on Sub-Saharan Africa, is targeting $150m for its new credit fund, according to Nicholas Hofgren, Advisory Board Member.

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TLG Capital, a private equity firm focused on Sub-Saharan Africa, is targeting $150m for its new credit fund, according to Nicholas Hofgren, Advisory Board Member.

“We can safely deploy this money into SME and lower mid-market growth companies and achieve our minimum target IRR with the collateral and credit enhancements we require,” Hofgren told Africa Global Funds.

The Credit Opportunity Fund (COF) will be launched in January 2016 and is TLG’s second investment vehicle.

"TLG Capital is excited to add another investment fund. The Credit Opportunity Fund will leverage off the success of our permanent capital vehicle, TLG Africa,” said Hofgren.

TLG Africa has committed over $15m to seed the new fund.

"We see continued demand from investors for TLG products. Management is a 40% investor in our current fund, TLG Africa,” said Hofgren, who is guiding fundraising and heading up an expanded environmental and social responsibility (ESR) function on the TLG Investment Committee.

“We are committing more than $15m to our Credit Opportunity Fund in the first close. We feel it's important to align with our investors. We expect a first close in early 2016,” he added.

AfrAsia Bank has issued a $7.5m debt facility to TLG Africa.

As experienced investors in African growth small and medium enterprises (SMEs), TLG has successfully structured and invested in private credit deals.

TLG’s investments have included credit enhanced products such as bank or multilateral guarantees.

The COF seeks to achieve enhanced risk adjusted returns, annual distributions and clear liquidity options through an annual gated capital redemption policy.

The fund will supply critical financing to corporates across the region.

Hofgren said that TLG sees opportunity throughout Africa but focuses on Anglophone Sub-Sahara (excluding RSA).

“We believe this region is benefiting from great demographic and economic change. We find little or no competition for our investment strategy. We can add a great deal of value to our operating companies in this region,” he said.

In addition to Hofgren, TLG Capital has added two investment professionals over the course of the year.

David Webb, formerly at Goldman Sachs and Managing Director at TSU Capital, will focus on deal origination, special situations investments and fund marketing.

Zhiyong Heng, formerly at DL Partners and Goldman Sachs, will focus on credit arbitrage and special situations investments.

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