WHAT WE OFFER

    CAPITAL AND ADVISORY SERVICES

    Risk capital

    The Arab Investment Fund provides risk capital for projects in North Africa and the middle East. Our investments are made on a commercial basis, and we offer funding in the form of:

    • Share capital
    • Mezzanine finance (equity-like loans)
    • Loans
    • Guarantees

    The Arab Investment Fund invests directly in companies in the investment country. The Fund will always be a minority investor and additional financing of projects is necessary. This may be through Danish or local investors or for example through regional development banks, etc. The funding from the Arab Investment Fund can range between DKK 15-150m in a single project.

    AIF investment model

    Advisory services

    The Arab Investment Fund provides professional advisory services all the way from the initial idea, through construction, and until the project is economically viable.

    The advisory services consist e.g. of an evaluation of the business plan, financing, legal issues, negotiating with partners, access to local authorities and localization, etc. The fund is involved in a thorough dialogue with the project owners and the involved Danish partners, where all relevant business issues are discussed and handled.

    The Arab Investment Fund also contributes with knowledge and advice sustainability issues and answers the questions that companies and investors are confronted with in relation to this topic. This applies for example for questions regarding the environment, employee relations, corruption and supply chains.

    Experience advisers in Denmark and abroad

    Advisory services are provided by IFU’s investment advisers in Copenhagen and via our regional offices in Asia, Africa, Latin America and Europe. Our Danish and local employees have extensive knowledge of such aspects as business environment, culture and language in their specific region.

    Additionally, the Arab Investment Fund can also draw upon IFU’s large network of external advisers.

    Handbooks that can guide your work

    IFU, the fund manager of the Arab Investment Fund, has prepared a series of handbooks on business plans, board work, sustainability and financial reporting. These are made available to interested companies and can be downloaded here.

    ACTIVE PARTICIPATION IN PROJECT DEVELOPMENT

    IFU and Danida have established a project development facility of DKK 50m, which may co-finance the costs of developing projects. The aim is to reduce the financial risk for Danish partners and developers who want to launch commercial projects, including North Africa and the Middle East.

    DKK 5m per project

    The prerequisite for IFU’s financial participation in the development of a project is that it is estimated that it can become economically viable and bankable in the future and that IFU can expect a return. If so, IFU can contribute 50 per cent of the development costs up to a maximum of DKK 5m per project.

    Projects must also be implemented in one of the 146 investment countries that IFU can invest in and comply with IFU’s sustainability policy and general regulatory requirements.

    Project must be approved by IFU

    Project proposals are treated individually and must include a business idea, perspective and specific costs. The proposals are presented at IFU’s investment committee meetings for final approval.

    Focus on larger Danish companies

    The target group for the project development facility is large and medium-sized Danish companies. Smaller companies are referred to IFU’s SME facility.

    SMALL AND MEDIUM SIZED COMPANIES

    Small and medium-sized enterprises form a large part of Danish industry, but these companies often lack the necessary resources to make investments in difficult markets. Consequently, Danida and IFU have established an SME facility which can support the individual company in the preparation and implementation of projects in developing countries.

    Financial support can be obtained for e.g. preparation of a business strategy, organisational and managerial development, feasibility studies, recruitment, environmental studies, training; and implementation of CSR initiatives.

    What is an SME?

    The facility is for small and medium-sized Danish enterprises. These are defined as companies with:

    • Less than 250 employees
    • A turnover of less than EUR 50m or a balance of less than EUR 43m

    Scope

    The maximum amount for a single project is DKK 1.5m divided in two with DKK 750,000 for the preparatory phase and for the start-up phase, respectively. The support is granted as a supplement to the company’s own investment and can only cover up to 50 per cent of the actual costs and 25 per cent of the total investment.

    Approval by IFU

    The facility is an integrated part of IFU’s work with investments in developing countries. Accordingly, Danish SMEs wishing to apply for support must be approved in accordance with IFU’s normal appraisal procedures focusing on the financial sustainability and contribution to the development in the investment country.

    How to apply?

    Contact Investment Director Ib Albertsen or Senior Investment Manager Anne Kathrine Oxenvad for further information.