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Frontier Markets Fund Managers

Orli Arav Senior Investment Advisor

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Private Infrastructure Development Group PIDG

TAF

PIDG U.K. SWEDEN NETHERLANDS SWITZERLAND AUSTRIA WBG INFRACO

EAIF

Management Agreement

GUARANTCO

ASPIFF

Management Agreement will be signed soon

FMFM

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- FMFM

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Frontier Markets Fund Mangers FMFM

 A Fund Management Team  Managing transactions for – Emerging Africa Infrastructure Fund; and – GuarantCo  A group of multi nationals fluent in English; French; Dutch; Italian and Russian  Based in London

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- EAIF

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Emerging Africa Infrastructure Fund EAIF

       

First dedicated debt fund for sub-Saharan Africa Size: US$305 million, refinanced to US$360 at the end of 2006 Original sponsor: UK Government – DFID 3 other European Governments joined (Sweden, Netherland, Swiss) Debt from three development finance institutions and two private sector international banks Public/private sector partnership Donor aid funds leveraged private sector capital for development purposes First multi-donor initiative by Private Infrastructure Development Group (PIDG)

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EAIF – investment policy

      Lend to private sector owned, managed and controlled entities with infrastructure sector focus – Power – – – – – Transport Telecoms Water Manufacturers of components of infrastructure e.g. cement Infrastructure within mining, agribusiness projects Sub-Saharan Africa focus excluding Mauritius Investment Size:US$10 -36 million Tenor: up to 15 years Instruments: Senior and Mezzanine Debt (possibly with equity features) Dose not require a Political Risk Insurance (PRI)

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EAIF - sample transactions

    Project: Sector: Celtel Nigeria Telecoms Country: Nigeria Description and Financing Parameters: – – EAIF has committed a US$ 35 million loan to Celtel Nigeria, the third largest mobile operator in Nigeria. The financing is part of a US$ 350 million financing package for the expansion and upgrading of their entire network.     Project: Sector: Ethiopian Airlines Transport Country: Ethiopia Description and Financing Parameters: – – – this is a unique project, EAIF has committed a US$ 36 million loan to the airline expansion project.

Ethiopian Airlines is a 100% publicly-owned entity often held up as a model business for other airlines in Africa. The EAIF financing is bridging a crucial gap enabling the airline to purchase additional, new aircraft at a cost of US$ 460 million.

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EAIF sample transactions (contd’)

    Project: Sector: Mnazi Bay Energy Power Country: Tanzania Description and Financing Parameters: EAIF arranged US$ 35 million – – – – – This is the first integrated utility project in Sub Saharan Africa, the project includes: the development of an existing natural gas reserve; the construction, operation and maintenance of a pipeline and gas processing facilities; the installation, construction, operation and maintenance of a power plant; the upgrade, operation and maintenance of a transmission and distribution system     Project: Sector: Moma Mining Country: Mozambique Description and Financing Parameters: – – – – The developers of this titanium mineral sands project approached EAIF as a ‘lender of last resort’. Located in one of the most under developed regions of Mozambique, the US$ 413 million project is the second lowest cost producer of titanium in the world.

EAIF committed US$ 24.5 million of senior and subordinate debt (total debt package of US$270 m illion) as Senior and Subordinated Lender. The project received deal of year awards from both the Mining Journal and Project Finance International publications.

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GuarantCo

 Credit enhancement of local currency debt issuance by the private, municipal and Parastatal infrastructure sectors in lower income countries  Covers similar infrastructure sectors to EAIF  Operates globally

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GuarantCo offers

      Guarantees covering default risk on underlying debt service - partial credit guarantees Guarantees covering default risk due to specific events - partial risk guarantees Cover for senior, mezzanine or sub debt; maturity, coupon or principal strips, carbon credits Other methods of risk transference e.g. insurance / reinsurance or CDS / derivatives Preference for risk sharing (defined on a case-by-case basis) Acceptance of certain local currency risks

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GuarntCo - sample transactions

Celtel Kenya

 Partial Credit Guarantee (75%) of a $50m equivalent 5 year bond issue for network expansion. Only the third commercial bond issued in Kenya and largest at that time – Closed Dec 05. – Refinanced in Feb 07 without credit enhancement

Celtel Tchad

 100% guarantee of $14m equivalent bank loan. Local lenders, Afriland First Bank and BDEAC, also lent $20m equivalent without guarantee – – Closed April 2007 Network expansion to more rural areas, which will aid both local communities and the significant nomadic population in Chad

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TECHNICAL ASSITANT FACILITY - TAF

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We can provide TAF funding

TAF provides grant funding to support the following activities;   Infrastructure development strategies – studies intended to guide governments on options for financing of infrastructure Policy, regulatory and institutional reforms – advice and training on the design and implementation of specific reforms aimed at facilitating infrastructure financing by the private sector   Pioneering or pilot transactions – support for the design and implementation of particular projects or transactions that are pioneering in some important respect or reflect some measure of innovation Capacity building – activities aimed at building government capacity and/or the capacity of local capital markets, financial institutions, and/or quasi-public enterprises

Infrastructure projects financed or in the process of financing by FMFM

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An example of companies we worked and are working with

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Contact details

Orli Arav Senior Investment Adviser

Frontier Markets Fund Managers T: +44 (0) 20 7815- 2782 M: +44 (0) 77254 - 29177 E: [email protected]