The International Finance Corporation (IFC), the private sector investment arm of the World Bank Group, is considering a $25 million investment in a new $500 million African private equity fund, signaling renewed confidence in the continent’s long-term growth prospects despite a challenging fundraising environment.
The proposed investment would be made into Virunga Africa Fund II, a growth equity fund managed by Admaius Capital Partners, an African-owned investment firm with offices across the continent. IFC is also evaluating an additional co-investment facility of up to $10 million to support selected transactions.
The investment proposal is scheduled for consideration by IFC’s board on June 10.
The move comes as African private equity managers face one of the toughest fundraising climates in years, with higher global interest rates, economic uncertainty, and reduced investor appetite for emerging markets making it harder to attract capital.
Against this backdrop, IFC’s proposed backing is being viewed as an important vote of confidence in Africa-focused investment strategies and in the ability of African fund managers to identify and grow businesses capable of delivering both financial returns and development impact.
Virunga Africa Fund II plans to invest in medium and large-sized African companies operating in sectors considered critical to the continent’s economic transformation, including healthcare, education, consumer goods, digital infrastructure, and financial services.
According to IFC, the fund aims to address persistent financing gaps faced by African businesses that have outgrown early-stage funding but continue to struggle to access long-term growth capital.
The fund intends to build a portfolio of between 10 and 12 companies, with investments ranging from $15 million to $50 million. Its target markets include Egypt, Kenya, Morocco, Rwanda, and South Africa, although opportunities across other African markets may also be considered.
The new vehicle builds on the performance of Virunga Africa Fund I, launched in 2021. That fund secured approximately $280 million in commitments from institutional investors and has invested in eight businesses across the continent.
Investors in the first fund include the Rwanda Social Security Board (RSSB), the Qatar Investment Authority (QIA), and South Africa’s Public Investment Corporation (PIC), reflecting growing participation from both African and international institutional investors in the continent’s private capital market.
Industry analysts say the proposed IFC investment could help attract additional investors to the fund, providing a catalyst for further capital mobilization at a time when many Africa-focused funds are struggling to reach target sizes.
Beyond supporting individual companies, the development is also seen as a test of whether international investors remain willing to commit long-term capital to Africa’s growth story despite global economic headwinds.
If approved, IFC’s participation would add momentum to a broader push to channel more private capital into sectors that support job creation, digital transformation, financial inclusion, and access to essential services across Africa.
The fund excludes investments in coal-related activities, non-certified sustainable palm oil operations, high-risk financial institutions, K-12 education, and projects classified as high environmental and social risk under IFC standards.
