6 December 2021
Why we invest in this sector
Local manufacturing capability is significantly underdeveloped in most African and South Asian countries. This stifles the pace of broader economic development.
It is not feasible to import all the manufactured goods required to keep pace with developmental needs, which slows inclusive progress towards achieving improved standards of living. Without a strong local manufacturing sector as a foundation, growth in other economic sectors is also constrained.
We invest to accelerate the sustainable growth and expansion of this sector across Africa and Asia.
Our strategic focus
We aim to invest in businesses that are not only commercially viable but also make a material contribution to wider economic development. This led us to prioritise investments that drive one or more of the following outcomes:
Inclusion – Improving the availability of manufactured products
We aim to invest into companies that will make manufactured final or intermediate goods more readily available domestically (or regionally) through lower prices, shorter lead-times or better quality (more fit-for-purpose) and that potentially displace imports. We prioritise manufacturers of goods that meet basic needs for shelter, food, sanitation, and healthcare, but will also consider other sub-sectors.
Productivity – Accelerating manufacturing ecosystem development
Our investments aim to accelerate the development of manufacturing ecosystems and we seek investment opportunities that help to remove growth constraints. An example of this could be a lack of local packaging suppliers preventing development of other sub-sectors.
We also support businesses to extend their capabilities and build more complex, high-tech skills, and we support strong management teams with local growth aspirations. And we back companies in sub-sectors that can export competitively.
Sustainability – Promoting more responsible production and consumption
We promote positive transformations within the manufacturing sector that lead to more sustainable production and consumption, cleaner technologies, gender equality, skills development, and better job quality. We also work with our investees to improve their ESG practices.
Within this pillar, we have a special focus on supporting circular economy enterprises – such as those that reduce plastic waste and we also prioritise ‘green manufacturing’ opportunities that aid in tackling the climate emergency.
We cover a wide range of manufacturing sub-sectors, while some of our team members also have specialist technical knowledge in the following subsectors:
- Waste management services
- Electric vehicles
- Specialised chemicals
- Business and supply chain services
- FMCG products
Who we partner with
We work with partners who are aligned to our values and mission goals. These can include:
- Local, regional and international corporates
- Funds and Impact investors
- DFIs, banks and other financing institutions
Our patient, long term view means we can participate in investments with longer horizons. It also means we can support a company’s growth through funding multiple rounds.
We provide a range of capital solutions across this sector
EquityTicket Size ($) 15-50m+
- Financing in USD, EUR and INR
- We provide flexible, tailor-made equity solutions
- We usually take significant minority equity stakes
- We can participate in consortiums and also work alongside co-investment partners
- We can do platform investments
- Technical assistance available where needed
DebtTicket Size ($) 10-50m+
- We tailor bespoke credit solutions to requirements, ranging from senior to mezzanine debt
- We typically fund long-term expansion capex projects and/or working capital requirements
- Tenor typically up to 7-10 years, sometimes longer, with flexibility on structuring of credit terms (including grace periods, interest capitalisation etc.)
- Deep expertise across Africa and Asia, including in-country execution in India, Nigeria and Kenya
- We can work with co-investment partners, banks, credit funds and other DFIs
FundsTicket Size ($) Varies
- We partner with established or first-time managers that take both majority and significant minority stakes in companies, ranging from SMEs to large cap
- These managers are investing across the sector, from food processing to automotive companies
- We work with fund managers to incorporate best-in-class environmental and business integrity practices
- We aim to be a reliable co-invest partner to our GPs, able to follow their lead or work alongside them
Sector Strategist - Manufacturing team
Director and Head of Consumer and Industrials Equity