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AfricaGoGreen Fund secures $47 million in equity investments to finance climate-friendly projects in Africa

The AfricaGoGreen Fund (AGGF) has closed its second fundraising round  at $47 million from the International Finance Corporation (IFC), the African Development Bank (AfDB), the Nordic Development Fund (NDF), and the Sustainable Energy Fund for Africa (SEFA)

The funding will enable AGGF to finance more climate-friendly projects in Africa, such as buying high-efficiency appliances and industrial equipment, repairing old buildings and building new green buildings, and putting solar panels and battery storage on the roofs of homes, businesses, and factories.

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“KfW is glad to welcome the new investors to the AfricaGoGreen Fund, which was initiated with seed capital from the German Government. We hope that more like-minded investors will follow. This successful second fundraising demonstrates that the fund is on track to play a crucial part in the just energy transition in Africa,” said Johannes Scholl, Head of Division at KfW.

“IFC is partnering with AfricaGoGreen because its innovative energy efficiency focus is making critical capital available to businesses that are supporting the region’s energy transformation while also expanding access to electricity, green building, and e-mobility solutions,” said Henrik Elschner Pedersen, IFC Regional Industry Director in Africa for Manufacturing, Agribusiness, and Services.

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As part of  the  funding,IFC offered  $17 million in equity, which includes money from the IDA20 Private Sector Window Blended Finance Facility. IFC  also   gave  $30 million in debt, which provided AGGF the long-term capital it needed to finish the second close fundraise.

The Sustainable Energy Fund for Africa, the Nordic Development Fund, and the African Development Bank each put $10 million into equity. In December 2022, Calvert Impact Capital paid off an extra $10 million in debt.

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Launched by KfW on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ) in early 2021 and managed by LHGP Asset Management, AGGF is the first structured debt fund in Africa focused on energy efficiency solutions.

 The fund targets reaching between $230 million and $250 million at final close. With the current fundraising round, total funding stands at $138 million, demonstrating that the fund is getting traction to reach its full scale.

Since  its launch .the firm AGGF has invested in  AktivCo(link is external), a telecom energy services company, to develop clean energy solutions for powering telecommunication towers in Burkina Faso, Cameroon, Chad, Côte d’Ivoire and Niger, and to BBOXX, a pay-as-you-go solar-powered solutions provider, to accelerate access to clean cooking solutions for millions of Africans.

AGGF has also more recently closed the Solarise transaction investing in energy-efficient appliances in Kenya, South Africa and Mauritius, and upsized both the AktivCo and BBOXX transactions.

“IFC is partnering with AfricaGoGreen because its innovative energy efficiency focus is making critical capital available to businesses that are supporting the region’s energy transformation while also expanding access to electricity, green building, and e-mobility solutions,” said Henrik Elschner Pedersen, IFC Regional Industry Director in Africa for Manufacturing, Agribusiness, and Services.

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