Africa Finance Corporation (AFC), a leading investment grade rated multilateral development finance institution, on 17 December 2014 announced the close of a $300 million dual tranche (two-year and three-year) club facility arranged  by six initial mandated lead arrangers (IMLAs) and bookrunners.

The financial institutions involved are Bank of Tokyo-Mitsubishi UFJ, Ltd; Citibank N.A; Deutsche Bank AG; FirstRand Bank Limited; Standard Bank of South Africa Limited; and Standard Chartered Bank. 

Each of the IMLAs and bookrunners committed $50 million funding to the facility.

Subsequent to the initial funding, a secondary market syndication of the facility was arranged, which witnessed a strong demand for the credit, with new commitments of $336.5 million obtained from 16 lenders across various geographies, such as Asia, Europe and the Middle East.

The lenders include Industrial and Commercial Bank of China Limited, Commercial Bank of Kuwait K.P.S.C, Korea Development Bank, KDB Bank Europe Limited, Burgan Bank S.A.K, Tunis International Bank, First Gulf Bank PJSC, Bank of China Limited, State Bank Of India, Banque des Mascareignes Ltée, Commercial Bank of Qatar Q.S.C, The Export-Import Bank of the Republic of China, Korea Exchange Bank, Al Ahli Bank of Kuwait K.S.C.P, First Commercial Bank Limited, Mega International Commercial Bank Co and United Taiwan Bank S.A.

Altogether, the facility was more than two times oversubscribed during the primary and secondary market processes, with AFC receiving total commitment of $636.5 million from 22 lenders.  

The proceeds of the facility will be used by AFC for general corporate purposes including the facilitation of trade.

AFC, a multilateral finance institution, was established in 2007 with a capital base of $1 billion, to be the catalyst for private sector infrastructure investment across Africa.  

The Senior Vice President and Treasurer of the development finance institution, Banji Fehintola, explained that “AFC’s long term vision is to help address Africa’s infrastructure deficit and ensure sustainable economic growth for the continent.” 

He added: We are encouraged  by the  confidence  that  our lenders have  placed  in  us. We  believe  that  the  well  documented need  for  bridging the infrastructure  investment  divide across  Africa will provide  the opportunity  to  apply  AFCs  differentiated  model  of  providing long-term infrastructure financing and value added infrastructure  asset  project development expertise,  to  generate  real value  for  our  investors  and  stakeholders”.

AFC’s  investment  approach  combines  specialist  industry  expertise with a  focus on  financial and technical advisory, project structuring, project development and risk capital to address Africa’s infrastructure development needs and drive sustainable economic growth.