Building on its successful deployment of Catalyst Fund I, Catalyst Principal Partners, a prominent East African private equity fund, launched Catalyst Fund II with a target size of US $175 million in low-income countries, comprising four core East African countries (Kenya, Tanzania, Ethiopia and Uganda), together with Rwanda, Zambia and the Democratic Republic of Congo.</span>
As the anchor investor in Catalyst Fund I, the Bank is considering an equity participation of 8.6 per cent of the second Fund’s capitalization and an Advisory Committee seat to ensure that transparency, social, environmental and corporate governance best practices are adhered to both at the Fund and portfolio company level.
The Fund will invest in the mid-market segment across local consumer demand-driven sectors focusing mainly on priority consumer staples: financial services, industrials and healthcare. Catalyst fund will work with its investee companies to create up to 130 full-time jobs per year, ensure fair distribution of benefits across gender and age groups, and enhance the socio-economic welfare of communities.
Catalyst’s investment strategy is aligned with the Bank’s High five priorities: Feed Africa (through investments in food and beverage, and agro-processing companies), Industrialize Africa (through investments in manufacturing companies), Integrate Africa (through investments in businesses that cater to the East African regional economies), and Improve the quality of life of the people of Africa (through investments in hospital, clinics, pharmaceutical companies and the financial services sector).
The Fund’s strategy is also well aligned with the Bank’s Ten Year Strategy (2013-2022), focusing on regional integration and economic growth through industrialisation, in order to achieve green growth and sustainable development in the Bank’s Regional Member Countries.