SunCulture signs $11m syndicated debt facility to expand solar irrigation
SunCulture, a solar irrigation company headquartered in Nairobi, Kenya, received the first disbursement from a new $11 million syndicated debt facility to expand its operations in sub-Saharan Africa.
The new loan is groundbreaking for the ”productive use” solar sector due to its size and its innovative combination of working capital and end-user financing.
SunFunder arranged as well as invested in the facility, leading a group of lenders comprising Triodos Investment Management, Nordic Development Fund, AlphaMundi and the AfDB’s FEI OGEF managed by Lion’s Head.
This will enable SunCulture to scale up renewable energy installations at smallholder farms and households that will mitigate over 20,000 tonnes of CO2 annually – as farmers replace diesel pumps with solar ones – whilst facilitating income growth and job opportunities in rural communities.
SunCulture has pioneered a ’pay-as-you-grow’ business model to make solar-powered irrigation affordable for smallholder farmers in sub-Saharan Africa, combining end-user finance, value-added services, modern climate technology, and access to improve productivity. A recent report by Dalberg Research shows that irrigation systems and solar-powered water pumps can increase farmers’ production between two and four times, and their income between two and six times.
Samir Ibrahim, chief executive officer at SunCulture said, ”The past year was devastating for the millions of smallholder farmers in Kenya; 87% are in a worse financial position due to the pandemic. Eighty-one per cent of SunCulture farmers, however, were able to increase their revenue from farming in 2020. Solar irrigation helps create food security and sovereignty, and it also helps lift people out of poverty.”
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