Africa-focused PE XSML Capital achieves first close of fourth fund

XSML Capital, an Africa-focused Dutch private equity firm, has completed the first transaction of its fourth investment vehicle to support small and medium-sized enterprises in Central and East Africa.

The Amsterdam-headquartered PE firm, which manages more than $150 million worth of assets, has announced a $98.7 million first closing of its African Rivers Fund IV (ARF IV) to financial companies on the African continent, including Zambia. was procured. The $135 million target fund has a hard cap of $200 million and is targeted for final completion in the second half of this year.

The fund will make more than 50 investments in African small and medium-sized enterprises, with an average target ticket size of $2 million to $3 million.

“Last year, despite the challenging environment for fundraising, particularly in Africa, ARF IV’s first closings exceeded the size of previous funds,” said Bartout van Slingerand, partner at XSML Capital. His third fund of $85 million in XSML became fully operational in the final quarter of 2023.

Fund IV is backed by a number of European institutional investors, including British International Investment (BII), a UK development finance institution and impact investor. FMO, Dutch Entrepreneurial Development Bank. International Finance Corporation (IFC), the private arm of the World Bank Group. Norfund (Norwegian Investment Fund for Developing Countries) and Swedfund (Swedish Development Finance Institution). His SIFEM, managed by ResponsAbility Investments, a leading impact asset management firm, is a new investor in XSML.

According to XSML, ARF IV already has a strong pipeline of potential new investments in Zambia, and XSML plans to open an office in Zambia in the first half of 2024.

Founded in 2008 by former FMO executives Jarl Heijstee and Marcel Posthuma, XSML Capital empowers talented entrepreneurs in Africa’s frontier markets to grow their businesses into sustainable mid-sized and large enterprises. We support this. With offices in Amsterdam, Kampala, Nairobi, Kinshasa and Luanda, XSML has invested $145 million in 71 small and medium-sized businesses and has delivered over 150 business improvement projects across its portfolio. It has started. A quarter of the company’s portfolio is invested in retailers and wholesalers, and approximately 15% is invested in manufacturing companies.

XSML Capital offers debt, equity, and mezzanine financing with ticket sizes ranging from $300,000 to $10 million.