British International Investment

Grindrod

Southern AfricaInfrastructure

Grindrod is a ports and logistics company based in South Africa; the company also has interests in the financial services sector.

Listed on the Johannesburg Stock Exchange, it operates in 32 countries worldwide, employing more than 5,500 skilled people through subsidiaries and joint ventures.

It has two divisions: freight services and financial services.

This investment was made when British International Investment was named CDC Group.

We have now exited this investment. This is what we achieved.

Achieved impact

We made a $17 million equity investment into Grindrod Limited in 2014. At the time, Grindrod Limited was a Johannesburg Stock Exchange (JSE)-listed and South Africa focused company made up of three divisions: shipping, freight, and financial services.
Our initial investment thesis was two-fold. First, we intended to generate $50-100 million of co-investment opportunities to provide much-needed improvements to ports, logistics and rail in Africa. In turn we anticipated these projects would directly create about 1,900 jobs in Grindrod's existing business. However, a weak commodity price environment caused several pipeline co-investment projects to fall away and led to job losses at Grindrod.
Second, we intended to support the company to improve its environmental and social systems and practices. Through our participation in the Safety, Health, Environmental and Quality Committee, we supported Grindrod in upgrading its environmental and social policies and some management plans. The progress made was deemed a success by a commissioned third party.

Expected impact

In 2014, CDC invested $16.6 million in Grindrod, providing finance for the company’s project development pipeline, which includes ports in Mozambique and South Africa and a 590km freight railway between Zambia and Zimbabwe.

Regional trade has an important role to play in long-term growth in Africa, especially since many African economies are not large enough to build strong internal markets.

Yet intra-African trade levels are very low, representing only 16 per cent of Africa’s overall trade. This is compounded by under-developed and costly transport infrastructure – 26 per cent of firms in sub-Saharan Africa identify transportation as a major infrastructure constraint.

Our partnership with Grindrod helps to develop and improve ports and logistics infrastructure across sub-Saharan Africa to reduce transport costs, increase cross-border flows of goods and push forward regional economic growth.

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.

    :
    March 2024
    Project number

    An identifier number shared by investments in the same project.

    :
    D196
    Status

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

    :
    Exited
    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.

    :
    Southern Africa
    Sector

    We prioritise those sectors that facilitate development and need our capital the most. Our priority sectors contribute towards many of the Sustainable Development Goals. They range from investing in the power infrastructure that will provide people with better access to electricity, to investing in financial institutions that direct capital to the individuals and businesses that need it the most.

    :
    Infrastructure

    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 :
    Equity
    Start date :
    May 2014
    End date :
    February 2020
    Amount :
    $16.63m
    Currency of investment :
    USD,ZAR
    Domicile

    The company or investment fund’s place of incorporation.

    :
    South Africa

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