- ILX Fund I to provide a scalable $1 billion private credit investment strategy for Africa
- New agreement to mobilize institutional investor capital in support of AfDB’s private sector loan operations focused on African countries
- Partnership to support the UN SDGs and climate finance-related targets
- Enable investments in Africa for ILX’s European pension fund participants
- ILX, key partner in catalyzing new SDG and Climate focused investments.
The African Development Bank and ILX Management B.V. (ILX) have signed a partnership agreement to scale up investments and spur institutional investor capital mobilization for Sustainable Development Goals and climate-focussed private sector projects in the Bank Group’s regional member countries. It took place at the offices of ILX Management in the Netherlands capital Amsterdam.
ILX’s investors are the Dutch pension fund asset managers APG Asset Management, (on behalf of ABP and bpfBOUW) and Achmea Investment Management, (on behalf of Pensioenfonds Vervoer), with other Dutch and European pension fund participants in ILX successor funds expected to join in the future. ILX Fund I provides a scalable $1 billion private credit investment strategy to be deployed across emerging and developing countries, co-financing with global Multilateral Development Banks (MDB) and other DFIs.
According to the press statement, the cooperation arrangement will enable the African Development Bank deliver on its ambition to mobilize financial resources from institutional investors to bridge the significant financing gap required to meet the Bank’s High Five priorities: Light up and Power Africa; Feed Africa; Industrialize Africa; Integrate Africa and Improve the quality of life for the people of Africa. The partnership will also allow the Bank and ILX to support non-sovereign operations in these key priority sectors. The High 5s are intrinsically linked to the SDGs.
The arrangement also offers ILX Fund pension fund participants the opportunity to benefit from the AfDB’s long-standing track record of successfully investing in key economic sectors across Africa. All loan investments are SDG or Climate Finance-focused while offering attractive risk-adjusted returns, combined with robust environmental, social and governance (ESG) safeguarding, the release indicated.
So far APG Asset Management, known as the Dutch’s largest pension provider, together with Achmea Investment Management, have already committed $1,050 million to Emerging Market private credit fund ILX Fund I, to invest in four key economic sectors – clean energy and energy access, sustainable industry and infrastructure, inclusive finance and food security. The firm also invests in loan participations arranged by Multilateral Development Banks and other leading DFIs in support of their SDG and Climate focused projects across the Emerging Markets and Developing Economies.
Hassatou N’Sele, Vice President and Chief Financial Officer of the African Development Bank Group, said: “We are very pleased to be partnering with ILX to mobilize institutional capital with a Sustainable Development Goals focus. Our objectives are aligned, and the African Development Bank has a strong track record of structuring and financing projects with a strong development impact.”
Manfred Schepers, Founder and CEO of ILX, also said: “We are delighted to have established this strategic partnership. The launch of this partnership demonstrates AfDB’s strong commitment to engage actively with European pension funds, as a key partner in its mobilization effort and contribution to sustainable growth across the African continent. We look forward to a long-term partnership with AfDB on behalf of our pension fund investors, which are becoming key counterparts to finance SDG and climate-finance projects across the emerging markets.”
Adding, Kitty van der Heijden, Director-General for International Cooperation, Dutch Ministry of Foreign Affairs, The Netherlands said: “With this agreement, Dutch pension funds, ILX and the African Development Bank join hands to increase investments in the SDG and climate goals on the African continent. A very welcome step, as the challenges in achieving the SDGs, and the need to integrate the global climate commitments in African countries’ development pathways, are more urgent than ever.”