Infrastructure projects blended finance firm the Emerging Africa and Asia Infrastructure Fund (EAAIF) has invested $28-million in the oversubscribed $300-million capital market maiden bond issue for mobile network operator Africell, which will support the roll-out of digital infrastructure across four countries.

The proceeds will support capital expenditure growth across Africell’s subsidiaries in Angola, the Democratic Republic of Congo (DRC), The Gambia and Sierra Leone.

This will strengthen the supply of mobile and data connectivity for approximately 14-million current subscribers, with conditions ripe for future expansion across these countries, said the EAAIF.

Further, book orders over $550-million meant that EAAIF could reduce its anchor commitment from $40-million to $28-million, thereby allowing the participation of more private capital from a variety of international investors.

The transaction deepens Africa’s financial services landscape and diversifies fundraising sources for dynamic, fast-growth businesses. This bond issuance is the first by any corporate or State in two of Africell’s four established markets, namely The Gambia and Sierra Leone.

It will provide international private investors with insight into these markets and create the opportunity for further, much-needed foreign investment, said the EAAIF.

“EAAIF's support and involvement gave other investors confidence, resulting in our debut issuance being heavily oversubscribed. Launching the bond is a transformational moment for our company as we offer investors exposure in four dynamic African countries,” Africell executive VP Magase Mogale said.

"We firmly believe in the development of capital markets and the mobilisation of private capital in low and middle income countries. That’s the only viable way the trillions of dollars currently available in developed markets will be channelled to support the much-needed economic and social growth for the six-billion people living in emerging markets,” said asset management firm Ninety One Group emerging market alternative credit director Tidiane Doucoure.

Ninety One Group, which is a subsidiary of investment management firm Private Infrastructure Development Group (PIDG), serves as fund manager for the EAAIF.

Developing Africa's capital markets is a key priority for the PIDG and Ninety One, the companies said.

In 2020, sub-Saharan Africa, excluding South Africa, contributed only 0.02% to the global stock of international bonds.

This presents a tremendous opportunity for global investors and ambitious businesses to increase access to growth capital from debt capital markets, they said.