South Africa: Edge Growth to administer J.P. Morgan's Abadali fund
The Abadali Equity Equivalent Investment Programme (EEIP) – a joint initiative by South Africa’s Department of Trade, Industry and Competition, and international investment bank J.P. Morgan – will provide short-, medium- and long-term finance over an eight-year period for qualifying businesses requiring growth capital, with priority funding being mainly directed at industrial and sustainable green enterprises.
The Abadali EEIP will be administered by a joint venture between established local fund manager Edge Growth and short-term capital fintech company Profit Share Partners
The primary objectives of the Abadali EEIP include enabling the development and growth of sustainable black enterprises, creating at least 1,000 permanent jobs and providing much needed strengthening of the local economy through business support. The programme will promote economic inclusion and opportunities for previously disadvantaged owners and employees of black enterprises.
“We are proud to announce that we have been awarded the opportunity to administer the medium- and long-term commitments of the Abadali EEIP, which will undoubtedly create much-needed positive economic and social impact locally,” says Richard Rose, CEO of Edge Ventures at Edge Growth. “We are privileged to be associated with this initiative to boost small and medium businesses, especially given the devastating effects of the pandemic and the need to grow businesses and job opportunities now more than ever,” he says.
The deployment of J.P. Morgan’s initial R300 million (about $20.7 million) through the fund and R40 million (about $2.8 million) through the grant is expected to result in R2 billion-worth of financing transactions and create a minimum of 1,000 jobs over the eight-year period of the Abadali EEIP. The Abadali EEIP will specifically address the critical funding gap for small and medium enterprises that do not meet the traditional underwriting criteria of general commercial banking requirements.
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