June 12, 2009—IFC and partners are helping save lives and strengthen health care in Sub-Saharan Africa through the creation of a private-equity fund that will invest in Africa's health sector.
The Health in Africa Fund will invest in small and midsize companies with the goal of helping low-income Africans gain access to affordable, high-quality health services. IFC's partners in this initiative are the African Development Bank, the Bill and Melinda Gates Foundation, and the German development finance institution DEG.
About the Fund
The new fund, managed by Aureos Capital, will make about 30 long-term equity and quasi-equity investments, ranging from $250,000 to $5 million, in socially responsible and financially sustainable private-health companies. It will be measured not only by fiscal performance but also by its ability to cultivate businesses serving the poor.
The fund will target a wide range of companies that deliver health services such as clinics, hospitals, diagnostic centers, labs. It will also invest in risk pooling and financing vehicles (health-management organizations and insurance companies); distribution and retail organizations (eye clinics, pharmaceutical chains, logistics companies); pharmaceutical and medical-related manufacturing companies; medical education; and providers of medical education.
IFC's Contribution
The fund is a key component of IFC's Africa health strategy, which includes improving the operating environment for companies in addition to providing financing. It is also part of the wider IFC-World Bank Health in Africa Initiative under which IFC intends to mobilize up to $1 billion in investment and advisory services over five years.
On June 4, IFC committed $20 million to the fund as part of an initial $57 million in investments from IFC and other partners. The African Development Bank invested $20 million, the Gates Foundation $7 million, and DEG $10 million.
In addition to the equity vehicle, IFC is improving access to long-term financing for smaller companies involved in health care through local financial intermediaries.
Together with the World Bank and other partners, IFC is also working with governments to help them harness the private sector to achieve national health goals and is producing the first biennial report on Africa's health care investment climate.
For more information contact:
Ludi Joseph
Senior Communications Officer
Phone: (202) 473-7700
E-mail: ljoseph@ifc.org
