Today, XSML, the fund manager active in Central Africa, announced the investment of its African Rivers Fund (ARF) in B.I.S., a Congolese manufacturer of generic pharmaceutical products. For over 20 years, B.I.S. has been producing and marketing tested solutions to prevent and cure infections to ears, eyes and throat, for the local market.
Kinshasa, Democratic Republic of Congo
While DRC shows a steady increase in purchasing power, and demand for affordable pharmaceutical products of good quality is increasing, the pharmaceutical market in DRC is still underdeveloped, lacking investment and heavily reliant on imports. As one of the few local manufacturers, B.I.S. has been able to cement a strong brand-name for its specialized products, and is now aiming for its next stage of growth.
According to the managing director of B.I.S., Mr. Jeremie Lubiba, “B.I.S. has developed itself from scratch to an established business in the last two decades and we are proud of our current position in the market, with well-recognized locally manufactured products, which have helped a great number of people. Our aim is to grow further and for that we need to improve our operations and deal with bottle necks”.
Jarl Heijstee, Managing Partner at XSML says: “We are excited to do our part in further developing the pharmaceutical sector in Congo, by investing in BIS’ improvement of its infrastructure. It will enable the company to further scale its production, gaining further reach with its products in DRC. Our outlook for the sector for the years to come is very positive and this is an opportunity to be part of that.”
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 (Belgian 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 250,000 and USD 5 million.
B.I.S. is a generic pharmaceutical manufacturer established in 1994 and produces and markets some 50 products in DRC. B.I.S. focuses on solid research and a specialized offering to treat conditions of ear, nose, eyes, throat and skin. The company was founded by Mr. Jeremiy Lubiba, who has over 20 years’ experience in pharmaceutical production in Kinshasa. B.I.S. distinguishes itself by offering high quality pharma products at attractive prices.
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).
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