XSML announces first investment by African Rivers Fund


Today, XSML, the fund manager active in Central Africa, announced the first investment of its African Rivers Fund (ARF) in Institut Aurora. Institut Aurora offers nursery, primary and secondary education to the population of Kinshasa. The school offers both a French Lycee curriculum as well as an English IB and a Montessori program.

Kinshasa, Democratic Republic of Congo

In the last decades, education has been heavily affected by various crises sustained by the DRC. For years there has been insufficient public sector investment in education, leading to a lack of supply by existing schools. Despite the increasing supply via public and private institutions, who offer national and international programs, there continues to be a large deficit in affordable, quality education. Focusing on lower middle and middle class households Institut Aurora offers an affordable internationally recognized education program for both the French and English speaking population of Kinshasa.

The managing director of Aurora, Mrs. Jayshree Aurora, states: “Our goal is to offer high quality French and English primary and secondary education at affordable rates to enable our students to get trained according to the highest international IB education standards as well as the French Lycee system. This helps them to be well prepared for an academic or professional life afterwards. As capacity of the current school facility is limited, we need to add additional class rooms and facilities as quickly as possible to cater for the demand from the students”.

Barthout van Slingelandt, Managing Partner at XSML says: “The success of Aurora demonstrates the strong demand for quality primary and secondary education in Congo DRC. While we invested with our first fund in the school when it just started, with our second fund we are able to finance the next step of its growth tripling capacity of the school from 500 to 1,500 students. The education sector in Congo has tremendous growth potential and long term capital is scarce. By providing this long term capital we enable the school to grow in its own purpose built premises – a good learning environment for Aurora’s students.”

ARF targets growing, well-managed small and medium-sized enterprises (SMEs) in the Central and East-African region covering Democratic Republic of Congo (DRC), Uganda and Republic of Congo as well as Burundi and Central African Republic (CAR). The fund, which had its first close at USD 50 million in Q1, 2016, is named after the two most powerful rivers in Africa, the Congo and Nile Rivers, which embody the potential of the Central African region. ARF follows the successful investment strategy of its predecessor, the Central Africa SME Fund (CASF), by providing debt, equity and mezzanine finance to fast-growing companies in the Central African region. All three current investors in CASF, IFC (a member of the World Bank Group), FMO (the Dutch development bank) and Lundin Foundation (Canadian foundation), are joined by BIO (Belgium Investment Company for Developing Countries), CDC Group (the UK development finance institution), Dutch Good Growth Fund (DGGF) and FISEA (AFD Group) – an expansion of the investor base of the African Rivers Fund, which demonstrates their commitment and support for investing in these frontier markets.

Through CASF, XSML has made 32 investments in SMEs across 10 sectors in Central Africa. CASF has been fully invested and has exited two investments. XSML believes that sustainable economic development in fast growing frontier markets as the DRC can be achieved by encouraging local entrepreneurship. Currently, many opportunities in these countries remain unexploited due to the lack of risk capital and support. By stimulating entrepreneurial endeavors, jobs and income are created. The African Rivers Fund continues CASF’s strategy with investments in between USD 200,000 and USD 5 million.

 

About Aurora ASBL

Aurora ASBL is a school established in 2012 offering French, English IB and Montessori education at nursery, primary and secondary level. The school has been founded by Mrs. Jayshree Aurora, who has longstanding experience in school administration in Kinshasa, with a degree in Accounting, Finance and Administration from the Université Libre de Bruxelles. Aurora distinguishes itself by offering high quality education at international standards at attractive prices in Kinshasa.

 

About XSML

XSML is an independent private equity fund manager with a focus on frontier markets in Africa. While building and managing funds for these markets, XSML, eXtra Small Medium Large, aims to help grow small businesses into medium and large enterprises. The team has an extensive background in emerging and frontier markets in the areas of asset management, corporate and development banking and corporate restructuring as well as in-depth knowledge of local markets. Our experience has shown that demand for finance from small and medium sized enterprises (SMEs) remains largely untapped despite increased interest in frontier markets from international investors. XSML bridges this gap between international investors and SMEs in these markets. With the Central Africa SME Fund and the African Rivers Fund, XSML now has USD 65 million under management. XSML has a dedicated team of over 12 investment- and operating professionals across offices in Kinshasa (DRC), Bangui (CAR) and a soon to be opened office in Kampala (Uganda).