Ninety One, a global investment manager managing £127.4bn has held the first close of its ACO Fund 3, the third vintage of its Africa and emerging market focused credit opportunities strategy, with $260m of capital commitments.
The fund has been raised in partnership with the International Finance Corporation (IFC), British International Investment (the UK’s development finance institution and impact investor) and the Swiss Investment Fund for Emerging Markets (‘SIFEM’, managed by responsAbility) as anchor limited partners, and with Standard Bank of South Africa as the credit provider.
According to a press statement, Fund 3 aims to provide investors with competitive return outcomes whilst simultaneously advancing economic development through sustainable capital deployment in Africa and other emerging markets. As part of its investment strategy, the ACO Fund 3 aims to positively contribute to the people, the environment, and the productivity of the regions it invests in by promoting environmental and social characteristics through the application of its proprietary sustainability framework.
Standard Bank has committed a debt facility of $45m in an innovative sustainability-linked loan, where the cost of funding is linked to the fund achieving certain climate/carbon and social impact targets.
This year, Ninety One’s ACO strategy celebrates its 10th anniversary since launch, with the strategy having raised just under $700m in committed capital across three fund vintages and made over $1.2bn in investments across 82 counterparties in more than 20 countries.
Almost half of these investments have been made in infrastructure and telecoms, helping the recipient countries close their infrastructure funding gaps. The strategy has achieved its return targets, whilst contributing to the UN Sustainable Development Goal 8 (Decent Work and Economic Growth) and 9 (Industry, Innovation, and Infrastructure) in about 50% of the investments.
The fund is led by portfolio managers Steven Loubser and Kobina (Kobi) Sam, who are managing directors in Ninety One’s Emerging Market Alternative Credit (EMAC) Team. The EMAC team has a 16-year track record of managing private and alternative credit funds in emerging markets.
