IFC invests in Axian to help boost Africa’s digital economy

IFC invests in Axian to help boost Africa’s digital economy

IFC, a member of the World Bank Group and the largest global development institution focused on the private sector in emerging markets, has announced that it has invested in a maiden bond issuance by pan-African telecommunications services provider Axian Telecom.

The bond, the first issued by Axian Telecom, will refinance the company’s existing debt and support its digital infrastructure network expansion, primarily in Tanzania and Togo.

By scaling up its digital infrastructure, IFC says, Axian Telecom will continue to promote Africa's growing digital economy and digital finance by bringing accessible, reliable and secure digital services in markets where access to affordable, quality mobile connectivity remains challenging.

Axian operates in eight markets through its subsidiaries in Tanzania, Madagascar, Togo, Mauritius and Uganda, and joint ventures in Senegal, Réunion-Mayotte, and Comoros. It operates across three key business segments, providing mobile network services as well as digital infrastructure and mobile financial services. 

As we reported at the time, last year saw the company purchase Millicom International Cellular’s Tanzanian operations, after which it added Tigo Tanzania and Zanzibar Telecom to its portfolio.

IFC subscribed to 12 percent of the bond (equivalent to $50 million) as an anchor investor in a total issuance of $420 million. 

As Makhtar Diop, IFC's managing director, puts it: “IFC's investment in Axian Telecom's bond is consistent with the World Bank Group's efforts to establish a more competitive and reliable telecommunications sector as part of the Digital Economy Initiative for Africa (DE4A).”

The Digital Economy Initiative for Africa (DE4A) aims to ensure that every individual, business, and government in Africa will be digitally enabled by 2030 in support of the African Union’s Digital Transformation Strategy for Africa.

IFC points out that capital markets are critical for filling the infrastructure investment gap in emerging and developing markets. In fact Axian Telecom represents IFC's second recent bond investment in Africa's digital economy. This investment follows IFC's participation in a bond issued by Liquid Intelligent Technologies, Africa's largest independent fibre, data centre and cloud technology provider.

IFC says that surging demand for digital connectivity during the Covid-19 pandemic led its commitments to the telecoms, media and technology sector in emerging markets to exceed US$1 billion in the fiscal year ending June 2021. It adds that almost three-quarters of the commitments were made in Africa.

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