10 SEPTEMBER 2007 - Africa Finance Corporation Board approves business and operating model

At a Board meeting today Professor Chukwuma C Soludo, Chairman of The Africa Finance Corporation (“AFC”) and Governor of the Central Bank of Nigeria, presided over the AFC’s formal Board approval of the strategic direction of the company and its operating model.

The key issues approved during this meeting are as follows:

1) The strategic direction of the AFC.
The Board approved the business model and operating model defined by the AFC and reiterated that AFC’s mission is to mobilise and channel capital towards driving Africa’s economic development through projects that address its needs in a profitable way, creating benefits for both investors and the societies and people on the African continent. 

The AFC business model is focused on the sectors that will generate the greatest beneficial development impact for Africa and the most attractive returns to investors.  These are power, transport and infrastructure, heavy industries, oil and gas, mining and telecoms.

2) The product focus for the AFC.
The AFC will focus primarily on project finance and play an active role across the full value chain including origination, structuring, syndicating and managing. It will invest in private equity in development projects. It will seed projects with its own equity and will collaborate with other private equity funds.    It will seed bankable projects and take responsibility for organizing the capital to fully fund such projects. The AFC's private equity business will focus on developing projects through an infrastructure, mining and energy fund platform.

3) Allotment to founding shareholders.
The Board approved the allotment of shares with a value equal to subscriptions received of US$ 1.05 billion.  51% of these subscriptions were received from shareholders in the private sector.

4) Appointment of Auditors.
The Board approved PricewaterhouseCoopers as auditors to the AFC.

Commenting on the results of the Board meeting Austine Ometoruwa, President and CEO of the AFC, said: 

“This is an exciting day for AFC and for Africa as a whole.  At a time when there is a growing realisation that investment in Africa can deliver massive benefits for both financial backers and the people and societies of the continent, AFC has the expertise, the strategy and the financial backing to make this happen.  We are looking forward to financing and executing projects that meet our twin criteria of having the potential to both deliver significant profits and generate huge improvements to the lives of thousands of Africans.”