Investors update: December 6 2022

Airtel Africa secures $194m credit facility from the IFC

Highlights

• Airtel Africa has signed a new facility with International Finance Corp, a sister organization of the World Bank and a member of the World Bank Group.
• The $194 million facility will last eight years and will support the Africa-focused telecommunications firm’s operations in the Democratic Republic of Congo, Kenya, Madagascar, Niger, the Republic of Congo, and Zambia.
• The funding provides more diversified access to local funding for Airtel and aligns with its strategy to increase debt within its operating companies. Airtel Africa shares were 1.2% lower at 120.98 pence each on Tuesday morning in London.

Source: The Economic Times

Our Takeaway

One of the major causes of the slow rate of digitization in Africa is the lack of affordable internet. As of December 2020, only 29% of Africans had access to the internet, which often comes at a high price and further broadens the existing digital divide between Africa and developed regions. If anything, the recent pandemic has highlighted the need for more people, especially in the continent’s lower-income countries, to access affordable and fast internet networks. Significant investments are key to achieving this. 

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Nigerian Eurobonds rallied in November on higher yields

Highlights

• Nigeria’s 5-and 10-year Eurobond prices rallied in the month of November 2022 as investors moved to rebalance their portfolios ahead of the new year whilst taking advantage of higher yields.
• The 5-year Eurobond dated November 2027 with a coupon of 6.5% closed the month of October priced at $71.39 with a yield of 14.45%. 
• Meanwhile, the 10-year Eurobond dated February 2032 with a coupon of 7.87% closed the month of October priced at $64.7 with a yield of 14.45%.

Source: Nairametrics

Our Takeaway

A unit price of Nigeria’s Eurobond is denominated at $100. At 14.5% for a 5-year Eurobond, the country’s foreign debt entered junk status suggesting investors were worried about the government’s ability to service it. But given the country has not shown any signs of default, it appears that investors see value in the bonds and are taking advantage of higher yields in the fixed-income market, leading to the rally. 

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Egypt-based SideUp raises $1.2m to expand across MENA

Highlights

• Egypt-based logistics platform SideUp has raised a $1.2 million seed round from Launch Africa VC, 500 Global, Riyadh Angels, Alex Angels, Al Tuwaijri Fund, and Saudi angel investor Faisal AlAbdulsalam. 
• Launched in 2019 by Waleed Rashed, SideUp (formerly VOO) provides e-commerce business owners with payment gateways, and API integration for shipping, warehousing, and fulfillment through one platform, to simplify operations and enhance customer experience.
• SideUp plans to utilize its investment to double down on its presence in Egypt and expand into Saudi Arabia, relocating its HQ to Riyadh.

Source: TechCrunch

Our Takeaway

Online businesses are shaping the future of the African economy. In the MENA region, the e-commerce sector is set to grow to $104.1 billion by the end of 2022, driven by a young, digital-native population. However, these businesses continue to face a number of challenges that limit their growth potential. SideUp addresses some of these issues, connecting over 2,000 merchants with a range of services, from payments to delivery, which allow them to focus on growing revenues.