Overview and features of the fund

FAFIN provides long-term, tailored finance and associated technical assistance to high growth, commercially attractive agricultural small and medium scale enterprises (SMEs) across all regions in Nigeria.

Fund Size

FAFIN has US$33 million in committed capital from its first close in 2014. The fund’s final close is scheduled for Q1 2017

Fund Term

FAFIN has an initial 10-year term ending in January 2024, but which is extendable for three additional 1-year periods.

Average Investment

FAFIN’s preferred investment size is the Naira equivalent of US$3 – US$5 million. However, it can consider investments as small as US$500,000 or on the higher side by levering co-investment capital from its investors to invest > US$5 million. Investment size is linked to a combination of factors such as company size (revenue, profitability), capital requirements, and company valuation.

Target Investees

FAFIN’s target investees are Small and medium scale enterprises (“SMEs”) operating across the agricultural value chain in Nigeria. FAFIN uses the European Union (EU) definition for SMEs, which amongst other criteria specifies a staff strength smaller than 250 employees. FAFIN is also able to invest in non-SMEs up to 30% of invested capital. FAFIN’s focus is on companies with revenues between N500 million and N5 billion. However, it can consider companies with revenues less or greater than this range if the fundamentals are attractive.

Technical Assistance Facility

FAFIN has a separate US$2.6 million funded Technical Assistance Facility that supports the success and sustainability of the Fund by providing technical services which promote the growth and development of investee companies while mitigating many of the risks inherent in investing in agricultural SMEs. This TA Facility enables FAFIN to provide small amounts of grant funding to portfolio companies on specific approved interventions.

Investment Strategy

FAFIN invests in opportunities that improve food security, enable import substitution, fix challenges along value chains, and meet the increased protein demand from Nigeria’s growing middle class.

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