The South Africa-based VC firm Vantage Capital has launched its fourth mezzanine fund, which will provide flexible capital to mid-sized African businesses in order to enhance job creation and promote much-needed economic opportunities and growth.
Vantage Capital, which has offices in Johannesburg and Cape Town, was founded in 2001 and is Africa’s largest mezzanine fund manager. The company has raised over US$1.3 billion in funding, and its mezzanine division has made 31 investments in 11 African countries across three funds since 2006.
The firm has announced the first close of its fourth mezzanine fund, which has received US $207 million in commitments from commercial investors in Europe and the United States, as well as development finance institutions (DFIs) such as IFC, CDC Group, and SIFEM. Vantage Mezzanine Fund IV is on track to meet its target of US$350 million in total fund size.
The fund will provide flexible funding to mid-sized African firms, boosting job creation and facilitating much-needed economic possibilities and growth – particularly important for post-COVID-19 recovery.
“Vantage is proud of the continued support received from its investors. We were the first independent mezzanine fund in South Africa when we raised Fund I in 2006. Mezzanine was not well known in South Africa at that time, let alone in the rest of Africa. Since then, we have taken our mezzanine product across Africa to 15 target markets, having invested in 11 of them,” said Warren van der Merwe, managing partner of Vantage Capital.
“Our fundraising success, in such a challenging environment, is a validation of the mezzanine asset class in Africa and of our role as a pioneer in this space over the past 15 years. As with previous funds, most of the funds have been raised from private sector investors such as insurers, pension funds and endowments who find our contractual yields and equity upside exposure attractive when compared to private equity alternatives.”