CSquared raises US$25 million to continue building carrier neutral broadband networks to digitally connect Africa

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CSquared, a pan-African technology company committed to digitally connecting Africa by making impactful investments in telecommunications infrastructure throughout the region has raised US$25 million in new equity to accelerate the expansion of its carrier neutral, open-access broadband infrastructure.

CSquared said the new equity investment from both new and existing shareholders to finance its ambitious growth objectives.  The investors include CPDIF, IFC – International Finance Corporation and the International Development Association’s (IDA) Private Sector Window Blended Finance Facility.

According to Lanre Kolade, CSquared Group Chief Executive Officer, “CSquared has demonstrated a proven track record in developing and commercialising carrier-neutral, open-access networks across Africa.  We remain singularly focused on changing lives through the digitalisation of the region and providing #InternetForAll.   The support from our investors, both existing and new, will transform our ability to deliver on this ambition. This involves expanding the digital broadband infrastructure footprint in all our current markets – Uganda, Ghana, Liberia, Kenya, DRC & Togo, as well as expanding into new markets in the near future.  Now, more than ever, the future is here #ADigitallyConnectedAfrica”.

This is the first tranche in a broader US$65 million investment programme to finance CSquared’s expansion and growth. Additionally, CPDIF has simultaneously acquired the stake in CSquared held by Google LLC. The firm will use the new investment for network expansion to drive digital infrastructure developments across its footprint and the broader African region.

CSquared was launched as a project within Google in 2011 with the ambition of building metropolitan fiber optic networks in Sub-Saharan Africa as a carrier-neutral operator of shared infrastructure. The long-term vision for the Company is to increase Internet penetration in Sub-Saharan Africa and to reduce Internet access costs by investing in the infrastructure necessary to drive digital transformation in the region.

In October 2017, in order to accelerate the scope and scale of the business, additional investors namely, Mitsui & Co., Ltd., Convergence Partners Communication Infrastructure Fund and IFC came onboard to deepen existing market penetration and expand geographically as the partners looked to commercialize the Company. Under the guidance of its shareholders, the Company has successfully established operations in six markets across the continent, namely Uganda, Ghana, Liberia, Kenya, the Democratic Republic of Congo and Togo. In addition, CSquared’s collaboration with Google in Togo was critical to delivering the first continental landing of the Equiano cable in Africa in March 2022, significantly transforming the affordability and availability of internet access in this previously under-served market.

Andile Ngcaba, Chairman and Founding Partner of Convergence Partners, added “The opportunity to increase our investment in CSquared via our most recently raised fund comes at a pivotal time for African digital development.  The benefits of world-class connectivity span all layers of society and have never been more tangible. As investors in the Company since 2017 we have had a front-row view of the tremendous impact of open-access networks on the development of the African ICT ecosystem. The combination of developmental impact, as well as strong commercial returns makes this an attractive investment for CPDIF and we are delighted to be able to shape the next phase of this journey”.

Commenting on its investment in CSquared, Sarvesh Suri, IFC’s Regional Industry Director for Infrastructure, Africa, said “Broadband connectivity is critical for Africa’s development. Our investment in CSquared is aligned with our regional strategy to develop digital infrastructure and promote the digital economy which can help leapfrog development for many African countries, support economic growth and stimulate job creation.”

FTI Capital Advisors DIFC Limited (“FTICA”) acted as financial advisor to CSquared on the capital raise and concurrent sale of the stake in CSquared held by Google LLC.