Convergence Partners Raises $120m to Drive Digital Inclusion

Emma Okonji

Convergence Partners, a private equity investor focused on the technology sector across sub-Saharan Africa, has announced the successful first close of its third fund, the Convergence Partners Digital Infrastructure Fund (CPDIF) at $120 million.

The fund is targeting a final size of $250 million. Now with more than $400 million of capital under management, Convergence Partners remains the largest private equity investor dedicated to digital infrastructure in Africa.

Investors in CPDIF are global institutions that continue to support African growth, including the CDC Group (the UK’s development finance institution), the United States International Development Finance Corporation (DFC), the European Investment Bank (EIB), the International Finance Corporation (IFC) and Proparco (the private sector arm of the Agence Française de Développement – AFD Group).

CPDIF investments will be driven by the infrastructure needs of the emerging growth themes in the digital infrastructure ecosystem, specifically fibre, wireless, data centres, towers, among others. It will also be driven by 5G, Cloud, Internet of Things (IoT), Artificial Intelligence (AI), fintech and network virtualisation.

CPDIF’s first investment is in Ctrack, a transaction that was announced earlier in the year. As a data analytics business servicing the fleet management and insurance industries, the business sits at the intersection of AI and IoT with all its solutions being cloud delivered.

According to the firm, the fund would have a strong and measurable impact objective and, via its participation in the build out of Africa’s digital infrastructure, would boost entrepreneurship, innovation, skills development and job creation though massively boosting access to the internet and all the critical digital tools it offers.

CEO of Convergence Partners, Brandon Doyle, said: “We are delighted to have achieved this milestone particularly given the headwinds in African PE fundraising generally, and the impact of the COVID pandemic on business activity, over the past 12 months. We are very pleased with the level of support from both repeat and new investors and believe this reflects our solid track record and the opportunity CPDIF presents at this crucial time in both a tech and African context.”

Chairman of Convergence Partners, Andile Ngcaba, said, “In the past 20 years, we have witnessed the exponential growth of internet penetration on the African continent. Internet penetration in sub-Saharan Africa alone has grown tenfold, compared to the threefold increase the rest of the world has seen. As Convergence Partners, we pride ourselves on contributing to this growth through our numerous communication infrastructure investments across the Continent. However, the COVID-19 pandemic has shown us that there is still much work to drive digital inclusion.”

CPDIF is a continuation of the strategy that has been successfully implemented by Convergence Partners since inception in 2006 across its funds under management. In the past 15 years, Convergence Partners has invested in submarine cable systems, geostationary satellites, terrestrial long-haul, metro and access fibre, wireless networks, data centres, as well as service provision delivered by these networks such as enterprise connectivity, SD-WAN, FinTech and HealthTech solutions, data switching and more.