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ICFA 2019 Cohort member Spark+ Africa Fund invests USD 4 million in BURN to accelerate its multi-country expansion across Africa

By 1st. June 2022No Comments

LUXEMBOURG, June 1, 2022 – Enabling Qapital (“EQ”) and Stichting Modern Cooking (“SMC”) are pleased to announce the initial investment of Spark+ Africa Fund (“Spark+” or the “Fund”).
Read more at
www.sparkafricafund.com.

  • Spark+ Africa Fund is a pioneering impact fund investing in access to clean and modern energy solutions for cooking in frontier markets in Africa.
  • BURN Manufacturing is a global leader in the design and manufacture of high quality, life-improving cooking solutions for the mass market in sub- Saharan Africa.

Spark+, which had its first closing in March, has invested USD 4 million via a long-term quasi-equity instrument in BURN Manufacturing (“BURN”), a Kenyan manufacturing company that specializes in the design and manufacture of biomass, electric, and LPG cookstoves that save consumers time and money, improve health, reduce harmful pollution, and limit the use of wood and charcoal.

The Fund’s investment will enable BURN to meaningfully increase the capacity of its industry-leading, industrial scale manufacturing facility in Nairobi, and finance the expansion of its business in new markets including Somalia, Ghana, Nigeria, Mozambique, and the DRC. The company has ambitious plans to serve 47 Million customers over the next seven years, which will create over 2,000 jobs and offset 72 Million tons of CO2e, the equivalent of 2 million cars on the road each year.

Spark+ was advised by University of Michigan Law School’s International Transactions Clinic (“ITC”) supervised by Carl Valenstein, a Partner at Morgan Lewis Bockius. BURN was advised by Sidley & Austin.

Peter George, Investment Director of Spark+ and Chairman of Stichting Modern Cooking: “This transaction is the result of a long and fruitful relationship with BURN. We’re incredibly pleased how the BURN team has leveraged a $500,000 start-up grant from the Clean Cooking Alliance in 2013 to become a true leader in its space. This investment also illustrates the role Spark+ intends to play in scaling up growth-stage ventures, and we look forward to supporting BURN as it extends its reach across Africa.”

Xavier Pierluca, Investment Director of Spark+ and Managing Partner of EQ: “BURN Manufacturing has demonstrated market-leading innovation capabilities, designing stoves for various fuels and consumer demographics, all while achieving scale in local production of quality products in Africa. We are very excited to engage in a long term financing relationship with the company to support its growth in new geographies to limit greenhouse gas emissions and deforestation across the Continent.”

Peter Scott, Founder and Chief Executive Officer of BURN Manufacturing: “As we embark on the most ambitious growth plans in our company’s history – expanding to new markets across Africa, increasing our production capacities, and launching new product lines – we are grateful to receive this timely investment from Spark+ Africa Fund. This funding will assist us in reaching new heights as the global leader of clean cooking design and manufacturing, and will allow us to continue executing upon our mission of saving lives and forests across the African continent. We are pleased that Spark+ has chosen BURN as their initial investment and we welcome their partnership on our shared journey.”

About clean cooking solutions: 900 million people in sub-Saharan Africa lack clean and modern energy for cooking. Without the electric stoves and piped natural gas prevalent in developed countries, they are forced to spend an estimated $35 billion annually on unhealthy and polluting open fires, charcoal, and kerosene. According to a 2020 World Bank report, this generates annual social, environmental, and economic costs of more than $330 billion in Africa, while the investment required by the private sector to deliver access to modern alternatives would be only $2.6 billion. Solutions that rely on LPG, ethanol, electricity, biogas, and processed biomass fuels, as well as more efficient biomass stoves, are being commercialized with technology-integrated business models and are enabling underserved consumers to adopt modern energy.

About Spark+ Africa Fund: Spark+ is the first impact investment fund launched by Spark+ General Partner (“GP”), a joint venture between its Switzerland-based investment advisor EQ, and Netherlands-based foundation SMC. Switzerland-based Woodman Asset Management acts as the Fund’s Alternative Investment Fund Manager (AIFM). The Fund’s investors include leading development finance institutions, pension funds, family offices, and foundations. The Fund has a target size of $70 million. The US-based Clean Cooking Alliance (“CCA”), an initiative hosted by the United Nations Foundation, supported the development of Spark+.

About Enabling Qapital: EQ is an investment advisory company with strong ties in the impact investment sector and deep expertise in finance, with its founding partners unique skillsets and 100+ year proven track record. EQ is the exclusive advisor to the Enabling Microfinance Fund and has a global footprint of investment professionals across Europe, Africa, Asia, and Latin America who originate, execute, and monitor investments. EQ is the exclusive investment advisor to Spark+ and a shareholder in the GP.

About Stichting Modern Cooking: SMC is a Netherlands-based foundation governed by a management board which consists of clean cooking sector experts and impact investment professionals. SMC is a shareholder in the GP and the Fund’s TA partner.

About BURN Manufacturing: BURN is the only vertically integrated modern cookstove company in Africa. Its solar-powered manufacturing facility in Nairobi currently has a capacity of over 50,000 stoves per month and employs over 600 people, 60% of whom are women. Since its founding in 2013, BURN’s products have delivered energy access to 7.5 million people across 14 countries in Africa.

About University of Michigan Law School’s International Transactions Clinic: The first of its kind in the United States at its launch in 2008, the ITC aims to be a training ground for highly qualified lawyers who graduate already experienced at representing their clients’ interests in an increasingly globalized and complex world. The BURN transaction team included Teddy Ulin, Yuzhen Zhang, and Saika Suzuki, and was supervised by ITC director David Guenther and Carl Valenstein, a Boston-based Partner in the corporate and business transactions practice at Morgan Lewis Bockius.

 

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For more information, please contact:

Peter George: peter.george@enabling.ch

Xavier Pierluca: xavier.pierluca@enabling.ch

 

www.sparkafricafund.com | www.enabling.ch | www.moderncooking.org

 

Article source: https://www.sparkafricafund.com/