Opic and Abraaj Capital sign commitment to regional small and medium enterprise fund
- Egypt: Monday, September 10 - 2012 at 10:22
- PRESS RELEASE
The Overseas Private Investment Corporation 'OPIC', the U.S. Government's development finance institution, and Abraaj Capital, a private equity group investing in growth markets worldwide, signed a $150m commitment to further enable the growth of entrepreneurial small and medium-sized enterprises 'SMEs' in the Middle East and North Africa.
With a capitalization of $400m, the Fund managed by Aureos Capital 'the small and mid-cap investing platform of the Abraaj Group' serves as a much-needed source of financing for SMEs, a powerful engine of economic growth across MENA but one which has traditionally lacked access to long-term capital.
Through this initiative, Egyptian SMEs are benefiting with Egypt being one of the core target countries of the Fund.
OPIC Chief of Staff John Morton and Abraaj Capital Ltd CEO Mustafa Abdel-Wadood signed the commitment letter at a ceremony in Cairo as part of a U.S. delegation to Egypt led by Deputy Secretary of State Thomas Nides and Deputy National Security Advisor Michael Froman, and joined by more than 100 U.S. business executives.
In his June 2009 speech at Cairo University, President Obama pledged that the U.S. Government would launch a new Fund to support technological development in Muslim-majority countries. Later that year, OPIC issued a call for proposals to establish technology and innovation funds according to the President's pledge.
The Abraaj Fund was one of a handful of Funds approved by the Board from the 87 responses OPIC received in response to the call. In June 2010, OPIC's Board approved financing for Abraaj Capital.
"Perhaps more than any agent of change, small businesses can help to restart the Egyptian economy and augment the transformative events of 2011 with economic growth that reaches a majority of the Egyptian people. Creation of this investment Fund is an important step in that direction," said OPIC President and CEO Elizabeth Littlefield.
"We are pleased to work with Abraaj Capital to make President Obama's pledge a reality," he added.
Mr. Abdel-Wadood said, "As announcement demonstrates, Abraaj Capital is fully committed to supporting the expansion of small and mid-cap 'SMC' businesses across the Arab world. We are very pleased to have joined hands in this effort with OPIC, which is investing in long-term economic growth in the wider region. We firmly believe that the SMC segment, which continues to suffer from a dearth of capital, is critical for economic development and job creation. At the same time, having recently invested in 15 SMCs across the MENA in various value-added industries, including two businesses in Egypt, we also recognize the tremendous growth opportunities that exist in this segment of the market."
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