ARM-Harith Infrastructure Investment Limited is a leading African private equity firm committed to catalysing economic growth through sustainable infrastructure.

ARM-Harith and FSDAi’s investment introduces an innovative solution to allow Nigerian pension funds to address a longstanding challenge in infrastructure equity finance: the ability to invest while receiving early liquidity.

By enabling predictable interim distributions during the early phases of investment, this innovative facility directly addresses a key barrier that has historically deterred domestic institutional capital from entering the asset class.

In addition, 75% of the FSDAi facility will be provided in local currency — a first-of-its- kind approach specifically designed to mitigate the impact of foreign exchange volatility for pension funds.

This structure is expected to unlock an additional GBP 31 million in pension fund contributions — nearly five times the participation achieved in ARM- Harith’s first fund.

FSDAi’s investment aligns with its broader mission to deepen African financial markets towards accelerating the financing of Africa’s green economic transformation and will support the Fund’s investments in climate-resilient infrastructure including energy, transport, water, and digital connectivity.

In alignment with at least four of the UN’s Sustainable Development Goals, the initiative is projected to create or support approximately 3,000 green jobs.

Mr. Jonny Baxter, the British Deputy High Commissioner in Lagos, said,

“The UK government, through its bilateral and investment vehicles is committed to continue to support the country’s financial sector — developing domestic capital markets as a means of financing priority sectors and driving economic development. Local currency capital helps mitigate the impact of foreign exchange volatility, narrows the financing gap, supports diversification into new asset classes and into climate- related projects and social sectors – while providing long-term funds to growing businesses.”

Announcing FSDAi’s investment, Anne-Marie Chidzero, FSDAi’s chief investment officer, said:

“We are thrilled to collaborate with ARM-Harith to showcase how risk- bearing capital from a market-building investor like FSDAi can be strategically structured to unlock domestic institutional capital. This approach strengthens Africa’s financial markets and facilitates capital allocation towards sustainable, green economic growth across the continent.”

ARM-Harith CEO Rachel Moré-Oshodi emphasized the significance of this investment:

“For too long, domestic pension funds have remained on the sidelines of infrastructure equity due to liquidity constraints and heightened perception of risk. We are proud to have collaborated with FSDAi to design a pioneering solution that reduces risk for pension funds while delivering both early liquidity and long-term capital growth. This is a global first—a groundbreaking private sector-led solution that could fundamentally change how infrastructure equity is financed—not just in Nigeria, but across Africa.”

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FSD Africa Investments (FSDAi), the investing arm of FSD Africa, today announces new investments totalling US$19.5 million to support climate adaptation and climate-aligned infrastructure projects in Africa and to promote the continent’s resilience to climate change.

The investments in Acre Impact Capital’s Export Finance Fund I, Catalyst Fund and Camco’s Spark Energy Services, demonstrate FSDAi’s commitment to partnering with local asset managers and venture builders to support climate-smart projects that would otherwise struggle to access the finance they need.

The new commitments include:

US$12 million in Acre Impact Capital’s Export Finance Fund I, the first to address the lack of commercial debt financing for sustainable infrastructure projects guaranteed by official Export Credit Agencies (ECAs).

Financing from ECAs reduces the cost of debt and makes infrastructure projects more affordable.

However, in order to access ECA support, project sponsors have to make a down payment of ~15% of the project value using commercial debt which is increasingly scarce.

FSDAi’s investment in Acre will facilitate the flow of ECA finance for social and green infrastructure, mobilising US$ 67 million directly related to FSDAi’s investment, providing improved access to essential services for over 500,000 people and generating over 2,000 jobs.

US$4.5 million in Catalyst Fund, a pre-seed venture capital fund and accelerator that will invest in and provide hands-on venture building support to tech start-ups that aim to improve the resilience of climate-vulnerable communities across Africa.

The investment will help demonstrate venture building as an investible model that can accelerate the growth of climate-smart businesses in Africa with a target of creating or accelerating 40 businesses and helping 5m individuals and households to adapt to the effects of climate change.

US$3 million into Spark Energy Services (Spark), which is designed and managed by climate and impact fund manager Camco to provide financing to captive solar and energy efficiency developers in Sub-Saharan Africa.

The platform seeks to address the lack of financing available to developers of smaller scale projects by innovatively aggregating small projects to reduce transaction costs and diversify risk.

FSDAi’s investment in Spark will support a just transition and achieve local development benefits by facilitating a 0.61m MtCO2e (million metric tons of carbon dioxide equivalent) net reduction in greenhouse gas emissions, working in partnership with local developers, creating 1,400 jobs and providing a lower cost, reliable and clean power supply to commercial and industrial SMEs.

FSDAi makes investments in support of ‘innovative’ financial instruments, facilities and intermediaries that can accelerate the role of finance in Africa’s green economic growth. It is funded through UK International Development from the Foreign, Commonwealth & Development Office (FCDO).

One of FSDAi’s distinctive features is its mandate to take significant investment risk. FSDAi fills an important funding gap by assuming the commercial risk of novel financial solutions that neither development finance institutions nor private investors are prepared to take.

The new investments will be announced by Andrew Mitchell, UK Minister for Development, at a joint event being held by FSD Africa and PIDG during the Africa Climate Summit on September 5th. 

It is one of a number of transactions and market building initiatives being unveiled by FSD Africa during the Summit which are designed to create a more innovative financing environment and so boost the participation of international and domestic private capital in Africa’s green economy.

Commenting on the investments Andrew Mitchell, UK Minister for Development, said: “The climate finance projects we announced demonstrate the strength of our commitment to Africa’s green future. UK leadership is determined to unlock the funding needed internationally to drive forward the green agenda. Our ambitions can only be realised through partnership and cooperation, with Africa and the international community. We are stronger together – and we go far when we go.”

Anne-Marie, Chief Investment Officer, FSD Africa Investments, said: “For Africa to achieve a green economic growth pathway, access to green finance needs to be scaled up. Our mission is to enable investments to flow by taking more risk and working with local intermediaries to bridge the gaps in the current financing structures.  We are backing these three funds, which provide innovative ways to finance businesses which will make a big contribution to Africa’s green economy.”

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FSD Africa Investments (FSDAi) has invested £1 million in Africa Climate Ventures (ACV), a pioneering venture builder working to build a US$45 million portfolio by the end of 2024.

ACV will catalyse the carbon asset class in Africa by building innovative businesses focused on solving our generation’s greatest challenge and at the same time capturing a significant share of global carbon markets in Africa. 

The venture represents a series of “firsts” in Africa: from its entirely Africa-based founder team and its permanent capital structure based in Kigali International Financial Centre, to its exclusive focus on carbon mitigation, capture and removal, the continent’s fastest evolving sector.

ACV represents a historic evolution in Africa’s carbon ecosystem and will contribute directly to capital mobilisation in climate action. Indeed, by 2030 ACV aims to eliminate one million tonnes of carbon every year while improving the lives of 50 million Africans and creating at least 5,000 jobs on the continent.

The venture builder features a peerless bench of experienced Africa-based founders with a record of pioneering innovation on the continent and championing disruptive enterprises.

James Mwangi is a 2022 Climate Breakthrough Award Winner and the founder of the Climate Action Platform for Africa, a non-profit organization that aims to help Africa achieve broad-based economic growth through climate action leadership.

James is best known as a co-founder of Dalberg Advisors, the firm’s first elected Global Managing Partner and then Dalberg Group’s Executive Director.

Mohamed Cassim is a South African investor best known as an angel investor, the Chair of MFS Africa Board, and the Founder of Abacus Advisory. CJ Fonzi was also a Partner at Dalberg Advisors, with the firm for over a decade he served as the Group Director of Innovation and then founded Dalberg’s Rwanda business in 2017.

This team is working to build a portfolio of climate positive businesses across Africa, with the ultimate aim of launching and scaling 15 ventures in the next four years.

ACV is seeking to build this portfolio by investing to: 

i) bring proven global climate technology to Africa,

ii) accelerate and de-risk the continental expansion of technologies and business models that have gained traction in one or a few African market(s), and

iii) add carbon revenue streams to existing African businesses with the potential to scale climate positive solutions.

ACV has adopted a structure more in-line with a global north venture studio in which the vehicle is structured as a permanent capital vehicle which sells equity rather than securing fund management mandates.

This has allowed ACV to begin building ventures in parallel with fund raising, which the founders believe is paramount given the urgency of climate change, and the need for Africa to quickly establish itself as part of the solution. 

There are already two ventures in the portfolio:

KOKO Networks Rwanda, a co-venture between ACV and KOKO Networks which already provides sustainable bioethanol cooking fuel to over 900,000 Kenyan families and aims to reach a million Rwandan families by 2027, and Great Carbon Valley, a Kenya based developer of direct-use clean energy applications currently focused on developing a direct air capture and permanent carbon storage site in Kenya.

ACV’s pipeline of further opportunities demonstrates the breadth and versatility of the venture builder. They range from biochar and enhanced rock weathering technologies, to biodigester and e-mobility businesses, to harvesting carbon revenue for green growth across the portfolio of a well-established continental private equity fund.

These are businesses and technologies which have the capacity to transform African economies and make a meaningful difference in climate change but they require risk capital and hands on venture builders to scale, attract further investment, and reach their potential.

FSDAi’s investment in ACV takes the form of a convertible loan of £1 million to support the venture builder’s formalisation and build additional ventures as demonstrations to attract investment from larger funds.

On top of this investment, FSD Africa will provide £75,000 in grant funding to support the development of premium carbon credits and the marketing of portfolio and pipeline companies. Moving forward, FSDAi has secured the right to invest up to £8 million in ACV’s planned 2024 close.

FSDAi is the investment arm of specialist financial development agency FSD Africa which receives funding from the UK government and provides tools and resources to drive large-scale change in financial markets and support sustainable economic development.

ACV is the latest in a series of investments by FSDAi in innovative green investment vehicles including Persistent Energy, a leader and pioneer investor in the off-grid energy and e-mobility sectors in Sub-Saharan Africa, and Nithio, which invests in renewable off-grid energy.

FSDAi has committed to support ACV on the basis that its activities will actively contribute to Africa’s transition to net-zero, the promotion and acceleration of the continent’s green sector, and the creation of quality, skilled jobs (around 600 will be created via this initial £1 million investment) in a strategically vital sector.

Ultimately, FSD Africa believes that ACV can help the continent’s businesses participate in global carbon markets and capitalise on the continent’s unrivalled capacity for profitable climate-smart businesses.

Moreover, FSDAi’s investment aligns with the emerging priorities of African policymakers who will gather in Kenya in September at the Africa Climate Summit to co-ordinate a unified, collective pan-African approach to the discussions at the next COP in Dubai.

Anne-Marie Chidzero, CIO of FSD Africa Investments, said:

“In backing the ACV partners, FSDAi sees a tremendous opportunity to galvanise global investment and finance to promote Africa’s status as the pre-eminent climate investment destination.’’

James Mwangi, CEO of Africa Climate Ventures, said: “We are thrilled that FSDAi has joined us in building ACV.  The involvement of FSDAi has already been invaluable in refining the ACV model. As we work towards ambitious objectives, we believe FSDAi will be a key partner in ensuring our success.”

Rachel Turner, Director, International Finance, Foreign, Commonwealth & Development Office, said: 

“We are excited to be supporting this enterprising partnership between FSD Africa and ACV. The need to mobilise climate finance for Africa has never been greater, and this can’t happen without innovations that can build the pipeline of opportunities to absorb and deploy capital into productive, sustainable and inclusive uses. Tapping into the developing carbon market ecosystem represents a significant opportunity for Africa to raise capital at affordable terms whilst contributing directly to the climate challenge. This partnership with an impressive African team is pioneering in its approach.”

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