Norfund and CDC to take direct ownership and control of Globeleq Africa

Norfund, the Norwegian Investment Fund for Developing Countries, and CDC, the UK development finance institution have announced a new partnership to boost power generation in Africa by adding at least 5,000 MW of generating capacity over the next 10 years.

Through the partnership, Norfund will acquire a significant minority stake in Globeleq Africa from the Actis Infrastructure 2 Fund for a cash consideration of approximately US$225 million.

CDC, which already holds a major indirect investment in Globeleq Africa via the Actis fund, will concurrently sell a small part of its holding to Norfund and transfer its remaining majority stake into the new venture. The agreement will result in direct ownership of Globeleq Africa by Norfund and CDC at 30% and 70% shareholdings respectively.

Globeleq Africa is an operating power company, actively developing energy projects across sub-Saharan Africa. It has eight major generating assets in Côte d’Ivoire, Cameroon, Kenya, South Africa and Tanzania with a total gross capacity of 1,095 MW. The company develops electricity generating plants that support the continued development of the power sector in these regions and actively participates in the communities in which it operates.

Norfund Chief Executive, Kjell Roland, said:

“This is a strategically important investment for Norfund. Inadequate and unreliable power supply is a major constraint on economic and social development in sub-Saharan Africa. This investment establishes a platform for Norfund and CDC to expand power production in Africa, based on the combination of financial capacity, industrial expertise, local partnerships and collaboration with authorities. This investment will expand Norfund’s presence in African power markets and widen our technology choice.”

CDC Chief Executive, Diana Noble, said:

“As the original founder of Globeleq in 2002, we are delighted to partner with Norfund in this new chapter for the business. Power generation is a priority for Africa, given how vital it is for long term economic growth and job creation. Early stage development is the bottleneck and the market desperately needs a committed, credible, expert developer of scale with a long term investment horizon. Under DFI ownership, Norfund and CDC have a vision of Globeleq Africa where it will support the development of significant new generating capacity over the next decade, and continue to run its existing assets efficiently, thereby bringing reliable power to many millions of individuals, families and businesses across Africa.”