31385 - Convergence Partners Communications Infrastructure Fund LLC

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Summary of Investment Information

Project Number

31385

Company Name

CONVERGENCE PARTNERS COMMUNICATIONS INFRASTRUCTURE FUND LLC

Date SPI Disclosed

Mar 9, 2012

Country

Africa Region

Region

Africa

Projected Board Date

Apr 26, 2012

Environmental Category

FI-3 - No Impact

Status

Active

Last Updated Date

Dec 21, 2024

Department

CN3SA - Regional Industry - INF Africa/INF Southern Africa

Industry

Funds

Previous Events

Approved : Apr 26, 2012
Signed : Jun 8, 2012
Invested : Feb 19, 2014

Sector

Growth Equity Fund

Project Description

The Project consists of an IFC’s equity commitment of up to US$45 million in Convergence Partners Communications Infrastructure Fund LLC, an up to US$500 million investment vehicle, which is being raised and will be managed by Convergence Partners Management Limited (“Convergence Partners”), a South Africa based investment management firm.

The Fund’s strategy is to invest in the opportunities presented by current underdeveloped state of Information and Communication Technologies (ICT) infrastructure in Africa. In IFC’s experience, funding is often not the only requirement for successful ICT infrastructure investments. Other critical components include project conceptualization, design, development and implementation. Over the past few years, Convergence Partners have demonstrated the capacity, knowledge and skills, as well as proven investment track that position the firm to successfully capitalize on the opportunities in Africa ICT infrastructure sector.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan
Equity	35.0

Development Impact

- Further Development of ICT Sector in Sub-Saharan Africa: Based on substantial expertise in ICT sectors and hands-on, value added approach to investees, the Fund Manager will continue to proactively source investment opportunities with significant socio-economic and developmental impact.

- Provision of Critical Funding and Expertise to Emerging Market Companies: The Fund will address critical funding needs by emerging market companies that due to their business stage or scale might face capital access constraints. The Fund's investments will support entrepreneurship, innovative business models and technologies, and generate employment. The Fund Manager will provide operational, technical and managerial advice to its investees.

- Development of Africa Private Equity Sector: The importance of private equity for development of emerging market private sector, nurturing entrepreneurship and supporting business innovation is well recognized, and IFC's commitment to the Fund will serve as a vote of confidence for Africa's growing private equity industry.

- Stamp of Approval/Mobilization of Funds: IFC's commitment to the Fund will serve as a stamp of approval to the Fund Manager's credibility, business strategy as well as managerial and technical capabilities. IFC's participation will be catalytic in mobilizing funds from other regional and sector investors as IFC will demonstrate its support for and confidence in growing Africa ICT sector.

- Regulatory Expertise/Business Networking: The Fund Manager will benefit from IFC's expertise and knowledge in regulatory and governance issues as well as substantial business networks in telecommunication and other sectors in Africa.

- Guidance in Environmental, Social and Governance Issues: Convergence has committed to monitoring the social and environmental impact of the Fund's portfolio projects and will be seeking IFC's guidance in establishing an efficient E&S monitoring system compliant with IFC's internationally acclaimed standards.

E&S Category Rationale / Risks and Mitigation

This transaction involves a Tier-II equity investment and the overall portfolio risk is considered medium. Therefore, the project has been categorized as FI-2 in accordance with IFC’s Environmental and Social Review Procedure. Convergence Partners Communications Infrastructure Fund s a dedicated private equity fund focusing on communication infrastructure and associated activities. The majority of the potential pipeline investments entail limited environmental and social (E&S) risks and impacts that can be readily addressed. The investments will focus primarily on the establishment of terrestrial communication networks and, to a more limited extent, marine networks. For this project, the client will be required to screen projects against IFC’s Exclusion List, national laws and IFC’s Performance Standards.

In accordance with IFC's Access to Information Policy, IFC will periodically disclose the names, locations and sectors of sub-projects that have been supported by IFC investments through private equity funds, subject to regulatory constraints and market sensitivities. The sub-project(s) listed below reflect(s) the status of the portfolio as of January 1, 2023.

Investee	Country Of Investment	Sector
Comsol	South Africa	N-AA - Broadband - Retail
RACK CENTRE LIMITED	Nigeria	N-BA - Internet Access Providers (Including ISPs, Datacenters)
CSQUARED LINK HOLDINGS (MAURITIUS) LTD	Africa Region	N-AA - Broadband - Retail
inq Holding	Southern Africa Region	N-AD - Other (Including Satellite Telecommunications, Radio and Television Broadcasting, etc.)
OBERTHUR TECHNOLOGIES	World Region	N-AD - Other (Including Satellite Telecommunications, Radio and Television Broadcasting, etc.)
Consolidated Capital Investments Proprietary Ltd	South Africa	N-AD - Other (Including Satellite Telecommunications, Radio and Television Broadcasting, etc.)
Channel VAS	South Africa	O-ME - Online payments, ecommerce payments

Contacts

For Inquiries About the Project, Contact

Idan Segal
Chief Investment Officer
Convergence Partners
33 Fricker RoadIllovo, 2196JohannesburgSouth Africa
Tel. +27 11 550 5320 / 5340Fax. +27 11 550 5321
Email. mailto:idan@convergencepartners.co.za
http://www.convergencepartners.co.za

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This Summary of Investment Information (SII) is prepared by IFC to disclose a factual summary of the main elements of the potential investment. It also includes findings and recommendations related to environmental and social considerations regarding this potential investment. The purpose of the SII is to enhance the transparency of IFC’s activities. For any project documentation or data included or attached herein, whether prepared by the project sponsor or otherwise, authorization has been given for public release by the project sponsor. IFC considers that this SII is of adequate quality for release to the public, but has not necessarily independently verified all of the project information therein. It is distributed in advance of IFC Board of Directors’ consideration and may be periodically updated thereafter. Board dates are estimates only and this document should not be construed as presuming the outcome of the Board Directors’ decision. The following SII is disclosed in accordance with IFC's Access to Information Policy (AIP) that went into effect on January 1, 2012.

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