Investments in private equity funds (PE funds) form a key part of DEG’s portfolio. These investments provide capital to private enterprises in developing countries, which they need to develop further. DEG has currently invested EUR 1.6 billion in more than 173 PE funds, providing a total of EUR 16 billion in capital to the companies they co-finance (investees) in developing countries and emerging markets. The PE funds co-financed by DEG invest in a total of almost 1,000 investees, with each fully invested fund typically consisting of between eight and 12 such investees.
As an anchor investor, DEG strengthens the capital base of the PE funds it finances, also helping to mobilise further investors. It also contributes market and structuring expertise, extensive knowledge of individual countries and regions, as well as its large network. Additional added value is provided by DEG’s advisory services, especially in environmental and social matters.
DEG supports funds and their investees with a comprehensive range of Business Support Services. It made more than EUR 2 million available last year alone to support 25 funds and investees in areas including environmental and social management, occupational health and safety, and management professionalisation. DEG’s fund investments lead to high development impacts, as the following evaluation of the 2022 portfolio shows:
Almost 1.86 million jobs secured – 62% of all jobs secured by DEG’s customers
500,000 new jobs since the start of the fund investments – 37% employment growth
More than EUR 105 billion in local income
Average revenue growth of 64% a year
147 investees in IDA/post-conflict countries
16.6 TWh of renewable energy – more than 47% of DEG’s share of renewable energy
EUR 90 million for local communities – a large number of funds are recording the local commitments made by their investees for the first time
The Development Effectiveness Rating (DERa) is one of the first systems in the world to look at the development impact of the fund at investee level. A Business Impact Profile gives fund customers qualified feedback on the impact of their investments – as a basis for the continuous development of their commitment.
Name: Adenia Capital (V) LP
Invested volume (in EUR): 19m
Adenia Partners, a private market investment firm, targets with its fifth fund control investments in medium-sized companies across Africa. In its fund business, DEG focuses on partners who want to actively manage and drive matching values in their investments. As a pan-African fund with a strong regional focus, Adenia has a 20-year track record of delivering economic returns to their stakeholders, while intentionally integrating ESG considerations and impact in its investment process. This progressively strengthened its system by adding holistic dimensions of sustainability such as human rights, gender and climate action. For its fifth fund, Adenia has set ambitious goals with regards to promoting gender-lens investing and minimising the fund’s impact on the environment. Its climate- specific commitments include becoming carbon-neutral by 2027 at Adenia Partners level and reducing the CO2 intensity of all portfolio companies. Adenia is one of a few selected Africa-focused fund managers to have been awarded 2X flagship fund status. This distinction underlines specific commitments with regard to gender balance and intentional impact, both at manager and investees level.