British International Investment

Pembani Remgro Infrastructure Fund II

Africa

Pembani Remgro Infrastructure Fund II will invest in infrastructure across Africa. We expect the fund to increase the stock and reliability of infrastructure on the continent, including improving access to reliable and affordable energy and data services, as well as increasing the efficiency of trade through better logistics. These investments will support businesses to operate more effectively and contribute to quality-of-life improvements in various parts of Africa.

Our investment

Description of the investment.

The fund aligns with our strategy to invest in core infrastructure in our priority markets, including the financing of digital transformation and a transition towards low-carbon economies. We are an anchor investor, supporting an experienced private equity fund manager that has differentiated itself as an early mover into innovative, high-growth and productivity-enabling subsectors such as data centres, fibre and digital services, distributed energy, and innovative logistics infrastructure. Our investment is critical to reach first close and is expected to help mobilise development finance institution and commercial capital alongside us.

Impact information

Applies to investments made from 2019 onwards. The tabs in this section define what we expect to achieve through the investment, assessing the potential impact of the investment against six dimensions of impact. You can find more details on our methodology of assessing impact here.

What?

Impact
  • Enable business expansion and job creation through productivity gains (SDGs 8.1, 8.5).

  • Improve standards of living through more reliable infrastructure services (SDGs 9.1, 9C).

  • Reduce greenhouse gas emissions through renewable energy generation (SDGs 7.2, 13A).

How?

How?
  • Increase access to reliable infrastructure services for businesses and residents, enabling economic participation, job creation, and business expansion and thereby enhancing productivity and quality of life.

  • Add renewable energy generation to avoid or displace greenhouse gas emissions.

Who?

Stakeholder Geography Characteristics
Employees

Africa

40 per cent of jobs are expected for women.

Consumers

Africa

Planet

Global

N/A

How much?

Scale Depth/Duration

Potential to be large-scale given the types of infrastructure assets targeted, which will impact many actors across the target sectors if proven successful.

Deeper impact expected in countries with lower baseline infrastructure provision in targeted sectors, and for those consuming more of the service.

Contribution/additionality

Contribution/additionality
  • Financial additionality: Critical role in enabling the fund to reach its first close and ultimately fund target size.

  • Value additionality: We significantly strengthened business integrity processes to reduce execution risk

Risk

Unexpected Impact Risk

Targeted investments in transport/logistics and ICT sectors can create greenhouse gas emissions unless opportunities to decarbonise are pursued. To mitigate this risk, we have discussed climate investment opportunities for ICT with the fund manager. Opportunities for decarbonising transport/logistics is outside of the control of the investment and the risk has to be tolerated.

Execution Risk

The fund may not deploy significant capital outside of Southern Africa. To mitigate this risk, the fund has developed pipeline opportunities across the continent.

Execution Risk

The fund may undertake a large proportion of acquisitions rather than pursuing greenfield investments, which would reduce the fund’s and consequently our own contribution. The indicative pipeline suggests greenfield opportunities and the fund manager intends to channel a relatively high proportion of brownfield investments into adding capacity.

Impact score

Impact score (at point of investment)

The Impact Score is a tool to help us manage our performance against our strategic impact objectives. It is designed to incentivise investments that support our productive, sustainable, and inclusive objectives. You can find out more here.

The Impact Score is published for investments made from 2022 onwards. The Impact Scores are calculated at the point of investment. We publish the Impact Scores of new investments annually, once the information has been externally assured by an independent third party.

8

Environmental and social information

  • Environmental and social summary

    A high-level description of the environmental and social aspects of the investment. This may include a summary of key environmental and social risks identified during environmental and social due diligence (ESDD); key elements of an environmental and social action plan (ESAP); or ways in which we plan to support the investee improve environmental and social standards, such as through their environmental and social management system (ESMS); as well as any other priority areas agreed with the investee.

  • Environmental and social risk

    A risk category rating, which indicates the level of environmental and social risk associated with an investment. For an explanation of the categorisations used, see here. We consistently provide an environmental and social risk category for all investments screened from 2023 onwards.

Environmental and social summary

Our focus is on the continued development of the manager’s ESMS, with an additional focus on climate change risk identification and management, and safeguarding. We agreed an ESAP focused on updates to internal safeguarding and grievance mechanisms, the establishment of an ESG committee and the engagement of a dedicated internal ESG resource.

Environmental and social risk

Medium-High

Reporting and Complaints Mechanism

The Reporting and Complaints Mechanism allows anyone outside BII to report alleged breaches of the business integrity or environmental and social provisions of BII’s Policy on Responsible Investing. This includes breaches made by BII, a BII investee, or a portfolio company of a fund in which BII has invested. The Reporting and Complaints Mechanism Rules are available here. Reports and complaints can be submitted by email to [email protected] or by mail. See more details on our Reporting and Complaints Mechanism here.

For any other general enquiries contact us at [email protected]

  • Key facts

    Last updated

    When the last quarterly update of the website database occurred.

    :
    June 2024
    Project number

    An identifier number shared by investments in the same project.

    :
    D5092
    Status

    The current status of the investment (green flag for active and red flag for exited).

    :
    Active
    Region

    The geographical region where the country is located. We currently invest in Africa, South Asia, South East Asia and the Caribbean. In 2023, BII’s investment mandate was extended allowing it to invest in regional funds linked to Ukraine, with the majority of activity expected to begin post-war. Investments outside these regions were made prior to 2012 under previous investment mandates.

    :
    Africa

    We provide capital in the following ways: directly – through direct equity, direct debt, guarantees and other non-intermediated financial instruments; and indirectly – principally through investment funds.

    For direct investments and fund investments, this is the date BII committed capital to the investments. This is typically the date on which legal agreements are signed by all parties.

    For the portfolio companies of our fund investments, this is the date (either the month or the quarter) on which the fund committed capital to the portfolio company.

    For direct equity investments, this is the date at which British International Investment exited the investment.

    For debt investments, this is the date at which the final debt repayment was made.

    For funds, this is the date at which the fund was terminated.

    For underlying fund investments, this is the date at which the fund manager exited the investment.

    The total amount committed, per financial instrument, per investment, on the date BII becomes subject to a binding legal obligation to provide funding or assume a contingent liability. This information is provided in US dollars.

    For direct investments, this is the amount that BII has committed to the business or project. For fund investments, this is the amount BII has committed to the fund.

    The currency in which the investment was made.

    Investment type :
    Fund
    Start date :
    October 2022
    Amount :
    $35m
    Currency of investment :
    USD
    Fund Manager:
    Pembani Remgro Infrastructure Managers (Pty) Limited
    Domicile

    The company or investment fund’s place of incorporation.

    :
    Mauritius
    Climate finance

    Indicates whether the investment is climate finance qualified or partially climate finance qualified and the type of climate finance (adaptation, mitigation or both). We define climate finance using the multilateral development bank (MDB) and the International Development Finance Club (IDFC) Common Principles climate finance methodology. See Common Principles for Climate Mitigation Finance Tracking and Common Principles for Climate Change Adaptation Finance Tracking. We provide the climate finance qualification and type for commitments from 2020 onwards, which is when we launched our Climate Change Strategy.

    :
    Partially qualified
    Climate finance type:
    Mitigation
    2X Gender Finance

    Indicates whether the investment is ‘2X qualified’ using the 2X Challenge criteria. You can find out more here. It only applies to investments made from 2018 onwards, when the 2X Challenge was first launched.

    :
    Fully qualified

Related investments made by BII into this fund:

Investment name Commitment Region Sector Start date Status
Investment 01 $35m Africa October 2022 Active
Investment 03 $15m AfricaAfrica November 2023 Active
Investment 04 $15m AfricaAfricaAfrica November 2023 Active

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