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Business Reporter
Atlas Merchant Capital and Mara Group, companies controlled by BancABC shareholders, have teamed up with General Electric to form a joint venture targeting investment in Africa’s highly underdeveloped infrastructure sector.

The joint venture will seek to invest in the infrastructure equity projects in selected countries throughout the African continent.

Africa presents high growth prospects in power generation, transport, oil and gas and other infrastructure areas including mining.

The joint venture will focus on this broad set of segments by facilitating access to capital, thus offering the ability to execute and fully finance both advanced and early development stage projects.

The hurdles to address are rapid urbanisation, and a growing middle class devoid of infrastructure. More than 50 percent of African nations including Nigeria, Kenya, Ethiopia, Tanzania and the DRC, do not have access to electricity and an infrastructure investment of $360 billion in power production, power transmission, water storage, modern railways, port capacity and modern highways will be required until 2040.

Furthermore, Africa needs to spend $90 billion a year for the next decade in order to upgrade and maintain its existing infrastructure alone.

President and chief executive of GE Africa, Jay Ireland, said: “This joint venture unifies three businesses with a strong commitment and expertise in infrastructure in Africa. The joint venture is our response to an integrated infrastructure approach in Africa.

“We are proud to partner with the expertise and talent of Atlas Merchant Capital and Mara Group, who have an extensive footprint in Africa, to address the necessities of the African continent.

“We have been significantly involved in social enterprises to date and will seek to further enhance and promote social and community development in the region to complement their expertise, knowledge and entrepreneurial spirit.”

Mara Group founder Ashish J Thakkar said: “Africa is a continent of 54 countries, but there is very low connectivity between them. Intra-African trade, a key driver for economic growth, represents only a fraction of Africa’s total trade over the past decade and this is largely due to a growing shortfall in infrastructure development.

“Through our joint venture with GE and Atlas Merchant Capital, we hope to tackle the funding deficit by creating a platform that has the power to truly change the lives of those living on the continent.”

African Development Bank president, Akinwumi Ayodeji Adesina said: “We are delighted to see this partnership between three world-class players who, together, can have a real impact on infrastructure development in Africa.

“We all know painfully well the imperative to fill Africa’s annual $50 billion infrastructure funding gap. Partnerships like these are a crucial part of the development agenda as we seek to promote social and economic development and fight poverty in Africa.”

The joint venture is well placed to act as a leading shareholder alongside sponsors of infrastructure projects and will use its relationships with lending banks and connectivity to power Africa and related institutions to meet the debt component of its funding.