South Africa: Kholo Capital fund reaches final close
The Kholo Capital Mezzanine Debt Fund I has reached a final close of about $76.1 million in commitments.
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Kholo Capital Mezzanine Debt Fund I, managed by Kholo Capital, has reached a final close at ZAR1.4 billion (about $76.1 million) in commitments. The fund will make long-term mezzanine debt investments in small and medium sized businesses in Southern Africa.
The fund provides growth capital, BEE financing and acquisition funding into various sectors of the Southern African economy, including social housing, healthcare, education, renewable energy, food, ICT, financial technology and infrastructure.
Kholo Capital’s investment criteria includes investing in small and medium sized businesses generating a minimum of ZAR25 million (about $1.4 million) in EBITDA. It has a preferred ticket size of ZAR70 million (about $3.8 million) to 200 million (about $10.9 million) per investment.
Mokgome Mogoba, founder and managing partner at Kholo Capital, said: “We are very bullish about South Africa, the South African economy and the future prospects of this beautiful country and the surrounding region … We are excited at the opportunity to bring creative funding solutions to the Southern African market and to form long term sustainable partnerships with businesses over a four to seven-year investment horizon.”
Zaheer Cassim, founder and managing partner at Kholo Capital, added: “Mezzanine debt funding is non-dilutive by nature and therefore is an attractive funding option for family-owned businesses, BEE companies or any business that needs to raise capital and hold onto the equity in the business. And with the banks becoming more risk averse due to regulatory requirements, lending to small and medium sized businesses has reduced, creating a great opportunity for flexible mezzanine debt structures. We are grateful that our investors recognise the opportunity and have shown us tremendous support.”
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Congratulations to Mokgome Mogoba and the team. All the best with your fund and allocations/investments from here on.