Investment management group Convergence Partners has unveiled the Convergence Partners Communications Infrastructure Fund (CPCIF), describing it as the only infrastructure fund solely dedicated to the ICT sector in Africa.
With a targeted final close of $250 million, the fund aims to invest in communications infrastructure and related services and technologies across sub-Saharan Africa.
Convergence Partners says the CPCIF expects to generate significant returns for investors, while also enabling ICT-driven socio-economic development.
"As specialist ICT investors and innovators, Convergence Partners is dedicated to accelerating investment capital, digital access and ICT infrastructure development on the continent," says chairman Andile Ngcaba. "As a result, we focus strongly on initiatives that increase the availability of communications, broadband services and new technology offerings to African people. The launch of this fund will enable us to achieve these objectives on a greater scale."
The CPCIF will invest across sub-Saharan Africa, with no single country or region expected to dominate in terms of capital allocation.
The African ICT sector has seen significant growth and acts as a catalyst for economic development, says Convergence Partners. The company refers to a recent McKinsey report, which says increased use of the Internet in Africa could result in a contribution of $300 billion a year to the continent's gross domestic product, by 2025. However, the infrastructure to enable such increased use remains significantly underdeveloped.
"Based on World Bank data, we estimate there is an ICT infrastructure deficit of $20 billion a year in Africa. The evolution of the ICT landscape, with its increasing focus on shared, open access models, provides significant investment opportunity for a specialised infrastructure fund," says Convergence Partners CEO Brandon Doyle.
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