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Bloomberg: Vital Capital collaborating with USAID Kenya Investment Mechanism to provide financing to Kenyan businesses affected by the COVID-19 pandemic

Kenya Investment Mechanism - July 21, 2020 - 0 comments

Business Wire

LARNACA, Cyprus & NAIROBI, Kenya — July 21, 2020

Vital Capital, a pioneering impact investment, private equity fund focused on
companies in sub-Saharan Africa, has announced a collaboration with the U.S.
Government’s Kenya Investment Mechanism (KIM). KIM is a five-year program
funded by the U.S. Agency for International Development (USAID) to unlock
significant financing to businesses in targeted sectors that have been
adversely affected by the COVID-19 pandemic.

Managed by Palladium, an international impact advisory and management firm,
KIM aims to unlock $400 million in investments for key sectors of Kenya’s
economy, including agriculture, and for regional trade and investment
opportunities. By unlocking finance to agribusinesses and other sectors, KIM
will pull small and medium sized enterprises (SMEs) into competitive and
growth-oriented value chains to foster broad-based, sustained, and inclusive
economic growth in Kenya.

“We are excited to launch this major collaboration to support Kenyan
agribusinesses in what is an incredibly challenging economic environment,”
said Nimrod Gerber, Managing Partner, Vital Capital. “KIM’s goals are closely
aligned with our own and we have a shared vision for the economic development
of the agricultural sector in Kenya. We believe this collaboration has the
potential to effect real change and support smallholder farmers survive the
worst ravages of the COVID-related economic crisis.”

In Kenya, COVID-19 threatens livelihoods and food security in a nation that is
already grappling with the worst locust infestation in 70 years and trying to
recover from extensive flooding. Around 27% of households are suffering from
food shortages, according to a recent survey by the World Bank, while in May,
the Central Bank of Kenya warned that some 75% of the country’s SMEs face
collapse without funding from banks or equity partners.

Under the agreement, Vital Capital and KIM will collaborate to identify
potential opportunities in KIM’s pipeline that corresponds to Vital Capital’s
investment mandate and to leverage KIM’s network of transaction advisors to
more efficiently bring transactions to close under Vital Capital’s investment
committee. Vital Capital and KIM are seeking to identify and execute at least
five completed transactions, providing at least $5 million in financing, to
alleviate the strain of COVID-19 on impactful Kenyan businesses, sustaining
500 jobs.

The collaboration follows Vital’s launch in April of the Vital Impact Relief
Facility, a $10 million emergency loan facility to offer critical funding to
promising African businesses to help them overcome the economic consequences
of the COVID-19 pandemic. “This collaboration with KIM is a significant
validation of our approach and we look forward to working closely together to
identify new opportunities and unearth companies providing essential services
to communities in Kenya to preserve their impact and employment,” said Guido
Boysen, Co-Lead of the Vital Impact Relief Facility.

“Vital Capital was quick to recognize and fast to respond to the economic
consequences of COVID-19 in Kenya, and we are pleased to collaborate with
them,” said Roger Bird, Kenya Investment Mechanism Chief of Party. “As a
long-standing investor in the region and, in addition to bringing new funding
and a pipeline of investment opportunities in our target sectors, the Vital
team bring a huge amount of experience and expertise of creating positive
sustainable impact that will be invaluable as we look to create enduring
economic growth in the country.”

About Vital Capital

Founded in 2011, Vital Capital is a leading impact investment, private equity
fund that is focused on sub-Saharan Africa and aims to benefit millions of
people in low and middle-income communities. Vital’s investments are guided by
the conviction that creating positive, sustainable impact goes hand-in-hand
with delivering market-rate, risk-adjusted returns for its investors. Vital
Capital manages the $350 million Vital Capital Fund as well as the new debt
facility. Vital Capital is focused on the fastest growing sectors in
sub-Saharan African markets with a primary emphasis on agro-industry &
processing, healthcare, sustainable infrastructure and education. Vital
Capital is led by a senior management team with over 30 years of cumulative
hands-on experience in initiating and executing ventures and businesses at
scale in Africa. Vital Capital’s investments have demonstrated that no
trade-offs are necessary between a project’s impact and its commercial
viability. Vital Capital is proud to be an active partner in the international
effort to embed impact investing further in mainstream investment practices.

The Vital Impact Relief Facility (VIRF) is a $10 million emergency debt
facility aimed at offering critical funding to promising African businesses to
help them overcome the economic consequences of the COVID-19 pandemic. The
facility is operational, and loans are ready to be deployed. More funding may
be raised in future to scale VIRF. For more information, please visit:

About Kenya Investment Mechanism

The Feed the Future Kenya Investment Mechanism (KIM) is a five-year
(2018–2023) U.S. Agency for International Development (USAID) program
supported by Feed the Future and Prosper Africa. KIM is mobilizing $400
million in investment for key sectors of Kenya’s economy, including
agriculture, and for regional trade and investment opportunities. KIM
addresses constraints on both the supply and demand sides of investment
transactions and is building a market system that will mobilize substantial
capital from the public and private sectors. By building local partnerships
among stakeholders in the financial system, KIM is stimulating the power of
the private sector to accelerate Kenya’s journey to self-reliance. For more
information, please visit:

About USAID’s Feed the Future Initiative

Feed the Future is the U.S. Government’s global hunger and food security
initiative. With a focus on smallholder farmers, particularly women and youth,
Feed the Future supports partner countries in developing their agriculture
sectors to spur economic growth and trade that increases incomes and reduces
hunger, poverty, and malnutrition. For more information, visit

About Palladium

Palladium is a global leader in the design, development, and delivery of
Positive Impact — the intentional creation of enduring social and economic
value. Palladium works with foundations, investors, governments, corporations,
communities and civil society to formulate strategies and implement solutions
that generate lasting social, environmental and financial benefits. For more
information, please visit:

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For Vital Capital
Stephen Fishleigh
Director, BackBay Communications
+44 203 475 7552 (o)
+44 7904 114 002 (m)
[email protected]

Emily Stoermer
Account Director
BackBay Communications
+1 617-391-0801 (o)
+1 401-585-6036 (m)
[email protected]

For Kenya Investment Mechanism
George Mbithi
Communications Manager, Kenya Investment Mechanism
+254 729 453 115 (m)
[email protected]

For USAID’s Feed the Future
Dave Charles
USAID/Kenya and East Africa Feed the Future Coordinator
[email protected]

This post originally appeared here on July 21, 2020.

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