Published: June 9, 2010
Equity firms support sustainable growth.
Global Environment Fund (GEF) has launched the first private equity fund that focuses on sustainable forestry in sub-Saharan Africa.
The US firm is targeting commitments of US$150mn for the GEF Africa Sustainable Forestry Fund and recently held its first close at US$84mn.
One of the fund’s major investors is CDC Group, a UK development fund of funds targeting the emerging markets of south Asia and sub-Saharan Africa, which has committed US$50mn.
GEF’s chief executive, Jeff Leonard, told emeafinance that sustainable forestry in Africa is a core area for the firm and “critical” for the long-term growth of the continent.
“We see the potential to build long-term capacity on the production and manufacturing side of the wood products industries that have substantial value, not only financially to the businesses but economic development value within the countries,” he added.
The fund will invest between US$15mn and US$30mn in forestry businesses that process products to meet demand from energy, biofuel and construction companies across sub-Saharan Africa, with a particular focus on greenfield and existing plantations.
GEF already has forestry assets in Mozambique and Swaziland.