The Africa Finance Corporation (AFC), a Lagos-based multilateral institution, and South Africa’s Harith General Partners have merged their renewable and non-renewable power generation assets in Africa to form a new energy joint venture.
According to a statement released on Wednesday, the new joint venture has a portfolio of assets worth $3.3billion. Some of the assets include Kpone Independent Power Project under construction in Ghana, and Cabeolica, a wind farm that provides 20 percent of Cape Verde’s power supply.
The joint venture’s assets have a combined gross operational and under-construction capacity of 1,575 MW and currently supplies reliable energy to over 30 million people in at least 10 African countries.
“Our new joint venture will make an invaluable contribution to improving generation capacity in countries across the length and breadth of Africa and by working together we can deliver tangible benefit for Africans, switching their lights on and stimulating positive economic growth on the continent,” said Andrew Alli, AFC’s CEO.
“Power is one of AFC’s priority sectors and we dedicate considerable time and resources to driving development here. Our total investments in energy amount to over $350 million and we were the first private sector institution to hit our target under President Obama’s Power Africa initiative, with total direct investments of $269 million and $1.2 billion of mobilized third party investments,” Alli added.
The joint venture will also hold the power assets of the Pan Africa Infrastructure Development Fund (PAIDF), which is managed by Harith. These assets include the Azura Edo IPP in Nigeria, the Lake Turkana Wind Power in Kenya, Kelvin Power Station in South Africa, and the Rabai Thermal project in Kenya.
As a result of the merger deal, the joint venture will be in a position to develop and finance projects through corporate finance transactions and project finance, significantly reducing the lead-time to bringing power projects to fruition. It will also have the benefit of a team of dedicated advisers that bring a wealth of development and operational experience in the African power sector.
“The purpose of the proposed merger is to combine the assets of Aldwych and AFC so as to create an African power entity that will have substantial capital, sector specific experience, a critical mass of existing assets and a pipeline of credible power projects,” said Tshepo Mahloele, CEO of Harith and Chairman of Aldwych, a Harith-owned London-based power company.
“This will enable the joint venture to expeditiously develop quality, cost reflective yet profitable power projects that will benefit Africans – both power users and investors alike.”